Barclays completes £600m Tesco Bank takeover

Barclays has completed its £600m takeover of Tesco’s banking arm after high court approval for the buyout came on 17 October.

As part of a ten-year partnership between the two firms, Barclays will begin operating and managing Tesco Bank.

Tesco will keep all of its existing insurance and money services activities, including ATMs, travel money and gift cards, with the supermarket stating that these offering are “capital-light, profitable businesses with a strong connection to the core retail offer”.

Following the takeover, Tesco said it would be returning £700m to shareholders through an incremental share buyback, which will begin after its ongoing £1bn buyback programme is completed.

With the takeover announced in February, the Big Four bank has now acquired Tesco Bank’s 2,800 staff, along with billions in customer deposits, credit card receives and unsecured personal loans.

“We are delighted to be working alongside Barclays to unlock even greater value for Tesco Bank customers,” said Tesco group CEO Ken Murphy.

“Through our strategic partnership, customers will have access to new and innovative propositions, while continuing to enjoy the unique benefits of Tesco Clubcard.”

Tesco Bank deal ‘important step’ for Barclays

“This acquisition is an important step in increasing our investment in the UK,” added Barclays group chief executive CS Venkatakrishnan.

“We look forward to collaborating with Tesco Group on delivering Tesco-branded financial services. We are delighted to welcome all transferring Tesco Bank employees and customers to Barclays.”

The news comes after Barclays shares hit a nine-year high last week after the bank’s pre-tax profit jumped 18 per cent over the last year, above analyst expectations.

“Today marks a significant step as we continue to grow Barclays UK,” added Barclays UK chief executive Vim Maru.

“We will bring the strength of both businesses together, benefitting customers and colleagues. I am excited that the combination of our brands, alongside the benefits of Clubcard and its loyalty scheme, will support millions of households across the UK with their financial needs.”