Barclays finishes Africa business sell down with bumper $2.8 billion stake sale

By Anjuli Davies

LONDON (Reuters) - Barclays will sell shares worth 2.2 billion pounds ($2.83 billion) in Barclays Africa Group, the bank said on Thursday, increasing the size of a stake sale due to investor appetite and marking a completion of its planned selldown.

The bigger than expected sale will take Barclays' stake in the Africa business to just 15 percent, the level the bank said it eventually aimed to reach.

The move draws to a close Barclays' 90-year history as a major presence in African banking, but will be seen as a big boost for Chief Executive Jes Staley, who wants the lender to focus on Britain and the U.S.

Barclays had said on Wednesday it would sell shares worth 1.5 billion pounds, reducing its shareholding to 28 percent in its second such sale since the British bank announced in early 2016 its intention to offload most of its African business. But strong demand meant it was able to increase the sale size to 285.7 million shares.

Barclays is partly relying on funds raised from the sale to meet capital requirements that were identified as a concern by the Bank of England in a November "stress test" aimed at gauging its ability to withstand financial shocks.

The bank said the sale is expected to result in an increase of approximately 27 basis points to its 31 March 2017 core capital ratio, a key measure of financial strength, which at stood at 12.5 percent.

Barclays said on Wednesday South African pension fund Public Investment Corporation would buy 59 million of the shares or 7 percent - which would up its holding in the business to 14 pct according to Thomson Reuters data.

The shares will be priced at 132 rand a share, a 5 pct discount to Wednesday's closing price of 139 rand, and raise an aggregate 2.2 billion pounds, the bank said. The bank will then place 12.7 million shares in a black economic empowerment scheme, taking its stake down to the planned 15 percent.

Barclays announced in March 2016 it would sell most of its 62.3 pct stake in Barclays Africa Group, giving itself two to three years to complete the sale. Its first selldown of 12.2 percent was completed in May 2016, but the bank had since been hindered by the regulatory delay and political upheaval in South Africa.

($1 = 0.7779 pounds)

(Reporting By Anjuli Davies; Editing by Rachel Armstrong)