KUWAIT:
Over the past few weeks, industry reports have again suggested that Ahli
United Bank (AUB) is on the lookout for acquisitions and could possibly
be involved in a US$5 billion sale or merger deal. Today, Islamic Finance
news (IFN)
takes a look at this proposition and evaluates its feasibility.
Based on the chronology of events, AUB shareholders first suggested
selling the bank in 2010. Due to undisclosed reasons, the sale failed to
materialize. The premise was revisited again in March this year, when a local
daily reported that AUB was on the lookout for acquisitions to expand and
develop its existing banking franchise in the GCC. The bank’s chairman,
Fahad Al Rajaan, reportedly said that the bank’s management was confident
in its continuing good performance which will be boosted by the growth in
economic activity in the region.
A few weeks later, Reuters reported that AUB was again contemplating a
sale or merger with another bank, in a possible US$5 billion deal.
Following this, a press statement was released by the bank which neither
confirmed nor refuted the claim. The statement iterated that it was
unable to comment on the matter as no official announcement had been made
at the time.
As reported earlier this week Hamad Al Marzouq, then deputy chairman and
managing director of AUB, resigned from his post and submitted his
nomination papers to run for Kuwait Finance House (KFH) board membership,
a day before nominations closed. Local dailies reported yesterday that
Mohammed Sulaiman Al Omar, CEO of KFH, has also resigned from his post,
with suggestions that Anwar Al-Ghaith, currently the chief operating
officer at KFH, would take up the role on an acting basis. IFN
understands that a number of departures can be expected in the coming
weeks, as sources suggest that this is not the end of the reorganization
exercise. According to a local news wire, a likely contender for the
position of CEO at KFH is Basel Ahmad Al Haroun, the commissioner of the
Capital Markets Authority.
In the previous months, IFN reports on other KFH changes include the
appointment of Hamad Al Marzouq and Abdul Aziz Al Nafeesi as board
chairman and vice-chairman, respectively. Elections to the new board also
comprise of Khaled Al Nesf, Moath Al Ossaimi, Fahad Al Ghanem, Nour Abed,
and Abdul Mohsen Al-Kharafi as well as substitutes Youssef Al Saqr and
Bader Al-Rabeea (see Vol. 11 Issue 14).
Due to Hamad Al Marzouq’s experience and track record and in light of
these recent events, industry observers have speculated that a merger
between AUB and KFH could be in the pipeline, giving KFH a bigger
footprint. It has been put forth that due to the Shariah compliant nature
of both financial institutions, the potential merger may occur between
AUB Kuwait and KFH, with the latter taking a prominent position.
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