Arab Banking Corporation (ABC), the parent company of the Arab Banking Group headquartered in Bahrain, is in the process of divesting its interest in its Hong Kong based subsidiary, International Bank of Asia (IBA).
ABC and Fubon Financial Holding & Co, a group in Taiwan, entered on into an irrevocable Share Sale and Purchase Undertaking on September 8, 2003. The effect of that irrevocable agreement is that Fubon mustmake an offer for the entire issued ordinary share capital of IBA and ABC must accept that offer.
However, the making of the offer and the proposed acquisition is subject to certain pre-conditions including the approval of the Hong Kong Monetary Authority, the Hong Kong Securities and Futures Commission and the Ministry of Economic Affairs in Taiwan.
The sale and purchase undertaking described above relates to 644,688,000 shares at a price of 3.68 Hong Kong dollars ($0.47) per share in IBA. Once the offer is made by Fubon and accepted by ABC, ABC will cease to be the parent company of a Hong Kong bank whose shares are listed on the Stock Exchange of Hong Kong.
"The decision to divest our interest in IBA is in line with ABC's strategic vision of focusing its core business franchise in the Arab World,” said President and Chief Executive of ABC,Ghazi Abdul-Jawad. “While IBA had been a profitable investment, the opportunity for business synergies within the Group's long-term objectives was limited. The proceeds of this sale will be utilized to augment ABC's capital resources and will be available to support future growth in our core Arab World businesses. ABC shall continue to service its Asian customers from its Singapore Representative Office and from its Bahrain Head Office." — (menareport.com)
© 2003 Mena Report (www.menareport.com)
