The sub-Saharan African bank, founded by ex-Barclays Plc chief Bob Diamond, will swap its operations in Rwanda, Zambia, Mozambique and Tanzania for a 6.27 percent stake in Nairobi-based Equity Group Holdings Plc, Atlas Mara said in a statement on Tuesday. The transaction is worth about 10.7 billion shillings ($106 million), Equity said in a separate statement.
The reorganization, which sees Chief Executive Officer John Staley stepping down to pursue other interests, comes after a review of the business that has struggled to contain costs that engulfed income and its share price plummeted more than 80 percent since being listed in London at the end of 2013. Atlas Mara faced much stronger and bigger lenders in the seven African nations where it operates, and also received criticism for overpaying for some acquisitions.
Read more on Diamond stepping back to focus on other investments
The Atlas Mara executive team will report to Chairman Michael Wilkerson, who also chairs Fairfax Africa Holdings Corp., which holds 49 percent of Atlas Mara after injecting funding into the company. Getting a stake in Equity Group means Atlas Mara becomes a meaningful shareholder in “one of Africa’s most successful and well-run banks,” the company said.
The transaction will result in increased scale in Rwanda and Tanzania once Atlas Mara and Equity combine their operations there, Atlas Mara said. The deal will allow Equity Group to expand its footprint in Africa, the Kenyan lender said.
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