UPDATE 1-Sherborne acquires voting rights over 5.16 pct in Barclays

* Shares up more than 3 pct

* Sherborne invested 580 mln pounds

* CEO had pledged to revive investment banking franchise(Adds Sherborne statement, price)

By Dasha Afanasieva

LONDON, March 19 (Reuters) - Sherborne, led byactivist investor Edward Bramson, has acquired voting rights of5.16 percent in Barclays' issued share capital, sendingthe British bank's shares up more than 3 percent.

Barclays had been under pressure from investors to make thelender a profitable investment banking force - something itsChief Executive Jes Staley had promised to do when he joined in2015.

The bank had been hit by a prolonged period of lowvolatility and tougher regulations on capital requirements.

Activist investors have become a growing threat for largelisted firms as they often use their minority shareholdings topush through major changes in company strategy.

"As with all its shareholders, Barclays will continue toengage with Sherborne, and welcomes them as a shareholder,"Barclays said in a statement after the initial disclosure of theshareholding.

By 0851 GMT, the bank's share price was up 3.6 percent at217 pence.

Sherborne said in a statement it had invested 580 millionpounds ($808 million) in the company's shares and derivatives.

Last week, shareholders told Reuters that Staley had onemore year to deliver on his promise to turn its investment bankinto a profit engine able to weather downturns or face demandsfor a review of the business.

Returns from investment banking have continued tounderwhelm, despite a recent turnaround in market conditions,leading some shareholders to set Staley a deadline for animprovement.

"We understand that Barclays have had a number of meetingswith Sherborne but do not know the details of their activism," aresearch note from KBW said.

"In our opinion, there is clearly substantial opportunityfor shareholder value creation from a change in direction," itsaid calling Barclays the perfect activist target.

Sherborne Investors, which describes itself as a turnaroundinvestment firm on its website, raised 700 million pounds in aninitial public offering last year.

Bramson's Sherborne forced British private equity firmElectra to fire its management team. It also investedin F&C Asset Management, displacing the chief executive andoverhauling the regulated financial firm's strategy in 2011.

It was founded in 1986 and is involved in both private andpublicly listed investments.($1 = 0.7179 pounds)(Additional reporting by Sinead Cruise and Helen Reid inLondon; editing by Louise Heavens and Jason Neely)