Mashreq bank says it is pressing ahead with moves to acquire the government-controlled Banque du Caire even though its initial offer was rejected.
Mashreq CEO Abdul Aziz Al Ghurair said his bank still wished to expand in the promising Egyptian market, adding he would wait for Egyptian authorities to come back with a new asking price.
The owners, Banque Misr, last week decided against selling 67 per cent of shares in the bank because they felt the bids from prospective buyers were too low.
An alliance of Mashreq, etisalat and DIFC Investments had offered $1.3 billion (Dh4.8bn). The UAE-based consortium will need to substantially raise its offer to surpass $2.25bn offered by the National Bank of Greece Group to remain in the running. Arab Bank of Jordan had bid $1.2bn.
Banque du Caire is the third-largest commercial bank in Egypt and has 112 branches in various of the country.
The scale and distribution of its network makes it particularly attractive to companies wishing to enter the market for the first time as such a reach would enable them to compete on a retail level.
Banque Misr said the subsidiary would be offered for sale again to Egyptian, Arab and other investors at the market price. It said the bank would not be sold until its real value was evaluated and subscribed to by investors.
"The Banque du Caire's restructuring programme is proceeding under the supervision of Egypt's Central Bank," said a spokesman.
"The rights of depositors and staff are being protected until the bank's situation becomes clear.
The successful investor will acquire 67 per cent of the shares, 28 per cent will be sold through an initial public offering and five per cent will be distributed among bank staff."
The spokesman said none of the three groups that reached the final stage of the initial auction had offered the Banque du Caire's true value, but refrained from disclosing what the value was.