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Kuwait Finance to acquire Ahli United Bank in reported USD 8bn+ deal
Posted on Friday, 13 September 2019 12:21
Kuwait Finance House’s board of directions has approved the tabled all-stock offer to pick up Ahli United Bank BSC of Bahrain.
The lender is offering one share for every 2.33 held in the target in an advisor-recommended swap.
Plans for the tie up were announced in January with Kuwait Finance said to be offering 3.25 billion new shares as consideration, which based on its closing price prior to this press release are worth KWD 2.04 billion (USD 6.69 billion).
Bloomberg suggested the deal would create the sixth-largest banking company in the Gulf with USD 100.00 billion in assets and in a transaction worth around USD 8.80 billion based on recent closing stock prices.
The final decision on the combination remains subject to approval from the general assemblies of both companies, as well as the Central Banks and the relevant regulatory bodies in Kuwait and Bahrain.
Ahli United Bank had total assets of USD 38.00 billion at 30th June 2019, with return on average assets at 2.2 per cent during the opening six months to the same date and equity attributable to owners of USD 3.90 billion.
During the timeframe, the lender recorded net profit of USD 377.50 million, net interest income of USD 22.90 million and non-performing loans ratio of 2.0 per cent.
Kuwait Finance had total assets of KWD 18.75 billion and total liabilities of KWD 16.69 billion at 30th June 2019.
Zephyr, the M&A database published by Bureau van Dijk, shows there have been 26 deals targeting credit intermediation and related activities providers in the Middle East announced in 2019 to date.
The tie up between Kuwait Finance and Ahli United Bank is the largest of these.
Other lenders include Union National Bank of the United Arab Emirates, Gulf Bank in Kuwait, Banque Saudi Fransi in Saudi Arabia and Bobyan Bank also based in Kuwait.
© Zephus Ltd