HARARE, November 5 (The Source) – Atlas Mara, owners of Pan-African banking group BancABC, says it has repurchased 20,000 of its shares as part of a $10 million buyback programme that could stabilise its share price which has fallen by nearly half over the past year.
The Africa-focused financial services group said the shares were purchased at a price of $5,50 each on Wednesday and will be held as treasury equity.
Treasury shares can be sold to the public in future as the company sees fit.
Market experts say selling treasury shares to the public can be a less expensive way for the company to raise capital because the amount it spent issuing them previously is a sunk cost.
The latest move comes after Atlas Mara share price has been performing below expectation, having fallen 29 percent on the London Stock Exchange this year, prompting the criticism for failing to purchase shares trading at less than book value. Year on year, the share price fell from $10,20 in November 6 last year to $5,60 on Wednesday.
“As a result of the repurchase of shares, Atlas Mara’s total number of ordinary shares in issue is 72,458,524 of which 1,688,559 are now held in treasury,” the company said.
The latest purchase also saw the financial services group increasing its total number of voting rights in Atlas Mara to 70,769,965.
Atlas Mara — co-founded by former Barclays Plc chief executive Diamond and billionaire entrepreneur Ashish Thakkar — made a splash in Zimbabwe last year by buying ABC Holdings — which owns BancABC and has presence in Botswana, Mozambique, Tanzania, Zambia and Zimbabwe.
The London-listed concern wants to establish a premier financial institution in sub-Saharan Africa. To date, the company has bought into banks in Rwanda, Nigeria and Zambia.