Muscat - Ahlibank, which signed a memorandum of understanding (MoU) with Taageer Finance Co for a possible acquisition, has completed the due diligence but has sought an extension, until the end of June 2013, to close the remaining formalities.
The bank had signed an MoU with Taageer Finance on February 17, 2013 to explore the possibility of acquiring the company, subject to satisfactory due diligence and obtaining the necessary regulatory and shareholder approvals.
"In terms of the MoU, Ahlibank has completed the due diligence and is in the process of negotiation. Ahlibank has sought an extension, until end June 2013, to complete the remaining formalities," the bank said in a disclosure to the Muscat Securities Market (MSM) on Sunday.
In a separate disclosure to MSM, Taageer Finance said, "We have received a letter from Ahlibank with regards to the transaction with Taageer Finance, which states that Ahlibank has completed the due diligence and they are working on the final details and assessment of the transaction."
"Based on the above, Ahlibank has requested for an extension of the MoU signed with them which expired on May 17, 2013. The board of directors of Taageer shall meet and review Ahlibank's request," Taageer Finance said.
Abdulaziz al Balushi, chief executive officer of Ahlibank, had told Muscat Daily in February that the bank is looking for a 100 per cent acquisition of Taageer Finance.
The price consideration is in the range of 176bz to 177.5bz per share. The price is inclusive of cash and stock dividends and will be adjusted downwards to reflect cash/stock dividends received by Taageer Finance shareholders, if paid based on financials for the year ended December 31, 2012, and thereafter, the bank had said that time.
Taageer Finance shares closed Sunday's trading up 3.23 per cent at 160bz.
Balushi had said that Ahlibank is focused on the SME sector, in line with His Majesty the Sultan's vision of developing the sector in the sultanate.
"The acquisition, if it becomes a reality, will help the bank increase its presence in the SME sector and in the development of our Islamic banking business," Balushi said.
© Muscat Daily 2013
