By Tinashe Makichi
The Common Market for Eastern and Southern Africa Competition Commission has begun the process of looking into the acquisition of Barclays Bank Zimbabwe’s majority shareholding by FMB Malawi from Barclays Plc.
The COMESA Competition Commission is an international organisation established to handle all mergers and acquisitions with a regional dimension moreso when both the acquiring firm and the target operate in two or more COMESA member states.
COMESA, which is Africa’s largest trading bloc, has 19 member countries which include Burundi, Kenya, Tanzania, Rwanda, Zimbabwe, Zambia, Malawi, Mauritius, Uganda, Egypt and the Democratic Republic of Congo.
COMESA Competition Commission manager for mergers and acquisitions Mr Willard Mwemba, confirmed that due process into the transaction was underway.
“We have started an investigation into the transaction involving First Merchant Bank of Malawi and Barclays Zimbabwe after they had made a notification to the Commission,” he said.
Mr Mwemba added that they had already received several complaints over the transaction which saw FMB acquire just under 42 percent of Barclays Plc’s nearly 68 percent in the Zimbabwean unit.
Plc will retain a 10 percent shareholding while an employee share ownership scheme will get 15 percent, which will be held in perpetuity.
“There has been an outcry from different circles on the complexities around the transaction.
‘We have, however, dispatched a team of investigators to look into the deal,” Mr Mwemba added.
FMB is a financial institution listed on the Malawi Stock Exchange and holds equity interests in banking operations in Botswana, Mozambique and Zambia.
According to inside sources, Plc will not get full cash but gets invested in the buyer through an instrument which they will sell later through a Mauritius-registered entity.
This implies that Plc would look to complete getting sale proceeds from Mauritius over a period of time, a situation analysts say is essentially externalisation of value from Zimbabwe. The Sunday Mail
