In its third significant move, the investment firm set up last year by former Barclays boss Bob Diamond and Africa-based entrepreneur Ashish Thakkar has increased its stake in Union Bank of Nigeria to almost 30% for $270m.
Atlas Mara bought a 20.9% stake from Asset Management Corporation of Nigeria for $270m (£165m), pushing its total stake in UBN up from 9% to 29.9%.
Diamond is aiming to build UBN into Africa's leading bank. The firm currently has some 340 branches across Nigeria, sub-Saharan Africa’s largest economy; and has about $6.3bn of assets, $3.1bn in deposits and $1.3bn in equity.
'This is a very significant acquisition, With it, we will have a significant stake in a key Nigerian bank and we will also have established strategic market positions in three of Africa's leading economic communities: the Southern Africa Development Community, the East Africa Community and Economic Community of West African States,' Diamond said in a statement.
Diamond and Thakkar raised $325m in an IPO last year to create Atlas Mara, as well as committing $20m of their own money. The firm focuses on African financial-services companies that can help businesses manage currency and commodity risks.
Earlier this year it acquired a majority stake in pan African banking group BancABC and is also planning to buy a 77% stake in the commercial arm of the Development Bank of Rwanda from the government.
Africa has become something of an investment hotspot for global institutional investors in recent years. Africa's emerging middle class is now seen as a lucrative opportunity, alongside the more traditional attractions of natural resources and mineral extraction.
However, Martin Gilbert, Aberdeen Asset Management's CEO, told MT earlier this month that Africa is not for the faint hearted.
'I love Africa for investment but you need balls of steel. You cannot attract too much money for frontier markets. But I admire Bob Diamond giving it a go,' he said.