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20 April 2024

ADCB to buy stake in Malaysia's RHB

By Agencies


Abu Dhabi Commercial Bank (ADCB) is close to buying a 25 per cent stake in Malaysia's fourth-largest banking group, RHB Capital, the Business Times said on Saturday, without citing its source.

The Middle Eastern lender may pay as much as 7.50 ringgit per share, the paper said, a price that represents a 33 per cent premium to Friday's RHB Capital closing share price of 5.65 ringgit.

A quarter of RHB Capital would be worth around $919 million at Friday's closing price.

Japan's Sumitomo Mitsui Banking Corporation, a unit of Sumitomo Mitsui Financial Group Inc, is also keen on a 5 per cent stake, with an option to further boost its holding by another 5-10 per cent, the paper added.

RHB is owned by Malaysian state pension fund, the Employees Provident Fund (EPF), which controversially won a $3.6bn takeover battle for RHB in March. The EPF has until June 2008 to reduce its holdings to 35 per cent from 82 per cent.

RHB Capital has announced a revamp plan to double profit and market value by 2010. It has plans to become one of the top three largest banking groups in Southeast Asia and expand its presence to China and the Middle East. (Reuters)