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VENTURES AFRICA – Estranged Barclay’s boss, Bob Diamond is planning to return to the banking scene in partnership with the founder and Chief Executive of Mara Group, Ashish Thakkar, by launching Atlas Mara, a $250m (£153m) “African venture” cash vehicle.
32-year old Ashish Thakkar is the , a $1bn conglomerate with business in 19 African countries ranging from technology, manufacturing and agriculture.
According to Reuters, Atlas Mara, will be managed by Atlas Merchant Capital, the merchant bank Diamond founded in New York- with a view to expand into sub-Sahara African banks and financial services.
Reports reveal the two financiers have approached investors hoping to raise $250m. They plan to list the cash shell on the London Stock Exchange before the end of the year if their capital raising plan succeeds.
“They plan to take control of an African bank and grow around it”, a person familiar to the deal said.
“It will be a multi-country operation, but not pan-African,” the source added.
The Atlas Mara acquisition vehicle is similar to cash shell companies – Vallar and Vallares – launched in 2010 and 2011 by financier Nathaniel Rothschild to buy mining and oil assets.
Atlas Mara is being advised by Citigroup (C.N).
The Atlas Mara acquisition will therefore usher Diamond return to banking by listing a shell company in London in the next few weeks to invest in the African financial sector.
Diamond left Barclays July last year following the Libor interest rate rigging scandal in which the bank was fined $450 million for alleged manipulation of the Libor interbank lending rate between 2005 and 2009. He kept a relatively low profile over the year quietly building Atlas Merchant Capital in New York several months ago.
During this period, Diamond was involved in a couple of recent US deals, including a personal investment in asset management business. Atlas Mara, which he founded after he was ousted from Barclays, is his first merchant bank deal.
Diamond had express interest over the years on investing on the continent. His family foundation invests in Africa, and he was also closely involved with Barclays’ push into the continent.
According to CNBC, the former Barclays boss recently met senior officials in Nigeria, fuelling suggestions he may be seeking to buy one of the country’s troubled banks.
Sub-Saharan Africa has been a home-base for investment over the years given the projection of a rapid economy growth and a stable political setting.
According to the International Monetary Fund (IMF), the continent is expected to grow by 6 percent next year, second only to developing Asia’s growth rate of 6.5 per cent.
Its financial sector which is mainly dominated by South Africa’s Standard Bank, Pan-African bank – Ecobank, and Nigeria’s United Bank for Africa has been a major target for banking investors who are hoping to leverage on the large number of unbanked population on the continent.
Barclays and Standard Chartered (STAN.L) – both international banking operations – have both said that they expect strong growth from their African operations in the coming years.