Effective 11 August, Bank ABC has completed the
acquisition of BLOM Bank Egypt, following a successful mandatory tender offer
and securing all necessary regulatory approvals
The acquisition will more than triple Bank
ABC’s market share in Egypt and create a new platform to turbocharge growth in
this core MENA market
Bank ABC is set to more than double its
branches in Egypt, diversify service offerings for wholesale, retail, SME, and
corporate customers, and offer an unparalleled digital banking experience
Manama, Bahrain: Arab Banking Corporation (B.S.C.)
(“Bank ABC”) today announced the completion of its acquisition of a
99.5% stake in BLOM Bank Egypt S.A.E. (“BLOM Bank Egypt”), significantly
enhancing Bank ABC’s presence in the MENA region, and deepening its roots in
the Egyptian market. This announcement follows the successful completion of the
Mandatory Tender Offer (“MTO”), share transfers and the release of the purchase
price of $425m to BLOM Bank S.A.L. (“BLOM Bank Lebanon”) and the minority
shareholders that tendered their shares in the MTO. This represents a multiple of 1.37x based on
BLOM Bank Egypt’s book value as of March 2021.
Leveraging Bank ABC’s more than 20 years of
experience in Egypt and BLOM Bank Egypt’s strong reputation and market
presence, Bank ABC aims to expand growth opportunities and strategically
increase offerings available for wholesale, corporate, and retail customers
alike. Bank ABC Egypt and BLOM Bank Egypt will continue operating as separate
entities until the legal merger is completed, which is subject to regulatory
approval and expected to conclude in Q1 2022.
The combined entity would more than triple Bank
ABC’s market share and take its balance sheet to approximately EGP 60bn on a
combined basis. Customers are set to experience expanded service offerings,
access to an additional 41 branches (more than doubling Bank ABC Egypt’s
current branches), and a range of digital banking services, leveraging Bank
ABC’s innovative digital capabilities such as its mobile only digital bank ila,
and its leading payments capabilities in its subsidiary, Arab Financial
Services.
With a track record of performance in 15
markets across 5 continents, Bank ABC’s robust financial balance sheet would
provide the combined entity with the required scale and support to reach a
larger customer base, ensure superior asset quality and execute higher
international financial transactions with a strong foothold across the MENA
region. This latest development in Bank ABC’s operations will enhance its
ability to deliver in the region and open a gateway to and from Egypt for Bank
ABC’s customers.
Bank ABC Group Chief Executive
Officer, Dr. Khaled Kawan, commented: “The acquisition of BLOM Bank Egypt is a
landmark moment for Bank ABC. We have been searching for the right opportunity
for many years—seeking an acquisition that further cements our reputation as
MENA’s leading international bank. This acquisition is a strategic fit for both
banks, combining BLOM Bank Egypt’s strong market presence and heritage with
Bank ABC’s track record of innovation. We expect the acquisition to unlock
considerable synergies and growth potential, allowing maximisation of value
across all our stakeholders. We would like to thank our advisors; HSBC, Freshfields
Bruckhaus Deringer and Zulficar & Partners for their commitment and
dynamism throughout the entire transaction process.”
Mr. Saad Azhari, Chairman and General Manager
of BLOM Bank Lebanon, commented: “BLOM Bank Egypt has delivered strong returns for our Group, and we are
confident that it will continue this legacy of success as a part of Bank ABC Group. We wish the BLOM Bank Egypt
team a great future in their new home. We would also like to extend a note of
gratitude to CI Capital, our exclusive financial advisor, and Baker McKenzie,
our legal advisor, for their exemplary work throughout this transaction.”
HSBC Bank Middle East is acting as the sole
financial advisor to Bank ABC, with Freshfields Bruckhaus Deringer and Zulficar
& Partners acting as legal advisors. CI Capital acted as the exclusive
financial advisor to BLOM Bank Lebanon, while Baker McKenzie acted as legal
counsel.
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Dr Khaled Kawan
Group CEO of Bank ABC |
Mr. Saad Azhari
Chairman and General Manager of Blom Bank Lebanon |