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Absa pulls out of talks to buy banks, says Nigeria

Posted by By Oludare Mayowa on 2005/08/11 | Views: 385 |

Absa pulls out of talks to buy banks, says Nigeria


Absa, a subsidiary of Barclays, had withdrawn from acquisition talks with three small Nigerian banks, Nigeria's central bank said yesterday.

Lagos - Absa, a subsidiary of Barclays, had withdrawn from acquisition talks with three small Nigerian banks, Nigeria's central bank said yesterday.

However, an Absa spokesperson was unwilling to confirm that the talks had ended, saying: "Absa is at a sensitive stage in negotiations with these three banks. We can neither confirm nor deny reports that Absa has withdrawn."

The three Nigerian banks - Habib, NUB International and Fountain Trust - had now begun merger talks with the local Afribank with a view to meeting new capital requirements by the end of the year, an Afribank source said.

"Absa has pulled out to sort out some domestic problems," central bank spokesperson Tony Ede said.

A source at Fountain Trust bank said Absa had requested more time to consider the buyout.

Britain's Barclays assumed voting control of Absa, South Africa's biggest retail lender, on August 2. Absa is now due to buy Barclays' African operations as part of that agreement, and one banking source said this would affect the timing of any future acquisitions.

Nigeria's overcrowded and fragile banking industry is in the throes of a forced consolidation process, driven by a 12-fold increase in the minimum capital requirement to 25 billion naira (R1.2 billion) due to take effect at the end of the year.

An Absa withdrawal would be the second South African snub to the reforms this month, coming on the heels of an announcement by Standard Bank that it would not recapitalise its Nigerian unit, Stanbic Bank.

Stanbic is still seeking a merger partner after two failed takeover attempts, and now faces the prospect of ceasing banking services at the end of the year until a new partner is found.

With about four months to go until the end-year deadline, 22 new banking groups have emerged comprising 64 banks in various stages of merger.

Absa shares lost 85c to close at R99.15 on the JSE yesterday. The banks sector gained 2.2 percent.

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Comments (23)

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emilia(Lagos, Lagos, Nigeria)says...

Wow,trying to get across to Ekene jnr he happens to be my old friend,lost his contact.any info would do me good

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Valarie(Nairobi, Kenya)says...

What’s your point?

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robloxian(Bangor, Maine, US)says...

hahahaha u r a wierdo…hehehe

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ur so boring(To, Northern Territory, Australia)says...

have u ever thought the garbage or the toilet might be jealous? Ur so full of shiz- white piece of shiz BET lol. That's where ppl like you belong (toilet garbage etc), ik the truth hurts but dont take it as an insult im just trying to describe you; ik im good at it ty-The truth hurts right. JSYK black ppl aren't nerds were just smarter than you oops Btw BLMM!!!

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robloxian(Bangor, Maine, US)says...

wow so bad.

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robloxiansays...

U r weird gus

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yawning(On, Northern Territory, Australia)says...

Hmmm define weird plz