South Africa's largest retail bank, Absa is set to take over Bank Gaborone in a development that could result in a merger in the local financial market.
Absa, which is 60 percent owned by Barclays Plc, on Friday announced that it has tabled a take over offer for Namibian financial services firm Capricorn Investment Holding (CIH) which is the majority shareholder in Bank Windhoek and Bank Gaborone.
If the deal goes ahead, it will result in two faces of Barclays Bank on the local market as the financial institution, which is UK's third largest bank, and already has a 67 percent controlling stake in Barclays Bank Botswana.
Last week Absa announced its plans to buy a controlling stake in Capricorn Investment Holdings, which owns 88 percent of Bank Gaborone, for an undisclosed amount, and said the deal was subject to several conditions that include shareholder backing from Capricorn and regulatory approvals.
Bank Gaborone marketing manager Sandra Mokobi confirmed that their parent company had received the offer from Absa sometime last week and negotiations for the deal could take somewhere between a month and three months.
" If the deal goes through, Bank Gaborone being a small and emerging bank would definitely benefit from Absa's financial muscle and experience. But as of now we don't know what is going to happen given that Barclays in already here and Barclays own Absa." But I guess it's a question of looking for opportunities in the Capricorn Group," she said.
Bank Gaborone was issued with a banking licence in February 2006, opening its first retail branch in September 2006 while Barclays Bank Botswana has been in the country for over a hundred years now.
It remains to be seen what will happen, if the deal goes through, to the two local banks as they will fall under one principal shareholder, Barclays Plc. Efforts to get a comment from Absa and the Bank of Botswana proved fruitless by the time of going to press.
Barclays took over Absa in 2005 in a 33 billion rand deal