Business | Banking
ADCB to buy stake in Malaysian bank for Dh4.4b
Abu Dhabi Commercial Bank (ADCB) on Thursday signed an agreement with Malaysia's Employee's Provident Fund (EPF) to acquire a 25 per cent stake for 3.876 billion Malaysian ringgit (Dh4.5 billion) in RHB Capital Berhad (RHB Cap) from EPF, a statement said.
- Staff Report
- Published: 10:08 May 8, 2008
Dubai: Abu Dhabi Commercial Bank (ADCB) on Thursday signed an agreement with Malaysia's Employee's Provident Fund (EPF) to acquire a 25 per cent stake for 3.876 billion Malaysian ringgit (Dh4.5 billion) in RHB Capital Berhad (RHB Cap) from EPF, a statement said.
"This is the largest transaction by a Middle East investor into the Malaysian financial sector so far," an e-mailed statement said.
"This landmark investment will pave the way for a strategic partnership between EPF and ADCB and drive RHB Cap's ambition to become one of the top three financial service providers in the Association of South East Asian Nations (Asean) by 2020."
At a ceremony held at Putrajaya in Kuala Lumpur, the deal was signed on behalf of EPF by Tan Sri Samsuddin Oman, chairman and Datuk Azlan Zainol, chief executive while ADCB was represented by Saeed Al Hajeri, chairman of ADCB's board and Alaa Eriqat, vice-CEO of ADCB, in the presence of Shaikh Hamed Bin Zayed Al Nahyan, Director of Abu Dhabi Crown Prince's Court, Dato Sri Mohammad Najeeb Bin Tun Abdul Razzek, Malaysia's Deputy Prime Minister and number of dignitaries.
With this deal, ADCB will become the second-largest shareholder of RHB Capital.
After this sale, the single-largest shareholder, EPF, will own about 57 per cent, down from the 82 per cent stake it acquired after completion of a general offer for the banking group on July 18, 2007.
The approval for this deal was given by Malaysian Ministry of Finance via Bank Negara Malaysia on February 29 and Foreign Investment Committee on March 21. The purchase process is expected to be completed soon.
Zainol said, "RHB Capital and ADCB will now be uniquely positioned to leverage on growing business flows between the GCC and Asean and strengthen both banks' strategic position in the global Islamic Banking market."
Linkage
Al Hajeri said, "This acquisition enables both ADCB and RHB Capital to promote the links between the respective countries and regions while generating significant value for stakeholders in the process due to inherent synergies. It is ADCB's intention to support RHB Capital in its strategic agenda of being a top financial services provider in Asean.
"The plan to double profit in three years is very attractive, very aggressive and very possible. My personal belief is that they will reach that target easily. The goal is to become top bank in South East Asia."
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