- SICO acted as Bahrain receiving agent, Bahrain execution advisor, and cross-listing advisor on the deal
The final results of the landmark USD 10.9 billion acquisition of up to 100% of Ahli United Bank B.S.C. (AUB) by Kuwait Finance House K.S.C.P. (KFH) were announced today. SICO BSC (c), a leading regional asset manager, broker, and investment bank (licensed as a wholesale bank by the CBB), acted as Bahrain receiving agent, Bahrain execution advisor, and cross-listing advisor on the deal, which was structured by way of a voluntary conditional offer by KFH to AUB shareholders to acquire up to 100% of AUB’s issued and paid-up ordinary shares. The transaction was offered through a share swap at an exchange ratio of 1 new KFH share for every 2.695 AUB shares.
This transaction marks the first time a Kuwait-listed institution cross lists in Bahrain and is the third largest banking acquisition in the GCC, with AUB’s market capitalization prior to its suspension closing at USD 10.9 billion. The consolidation is expected to create the region’s sixth largest bank.
SICO’s CEO, Najla Al-Shirawi, said, “We’re proud of our role as one of the leading advisors and the impressive results we succeeded in achieving in the closure of this milestone cross-border transaction. We’ve leveraged our on-the-ground expertise and experience structuring and managing initial public and secondary offerings and executing on some of the region’s most high-profile and complex public and private acquisitions to execute this unique opportunity. A transaction – which includes cross listing – that has been years in the making, this deal not only drives value for our clients but for the market in its entirety as we set new heights in the GCC M&A space.”
The initial offer period started on 24 August 2022 and the final offer closing date ended on 23 September 2022. The offer received acceptances representing 97.273% of AUB’s shares, far exceeding expectations and surpassing KFH’s minimum condition of 90% acceptance. In accordance with Bahrain's Commercial Companies Law (CCL) and the CBB's Takeover, Mergers and Acquisitions (TMA) Module of the Rulebook, KFH has exercised its right to squeeze out the remaining shareholding of AUB.
“As a cross-border public takeover in Bahrain, coupled with simultaneous execution in Kuwait, and a 100%-share exchange structure with substantial offer conditions, our mandate required significant synchronization with numerous stakeholders and to ensure AUB’s shareholders could participate in the offer in a seamless and efficient manner — we are proud to continue to deliver recent firsts in the last decade with this transaction adding the first major cross border acquisition , the first cross listing ,and the first use of the squeeze out right ,” said Wissam Haddad, Head of Investment Banking and Real Estate at SICO. “M&A activity continues to experience a boom in the region, especially in the financial sector, as consolidation opens up new avenues for expansion into new markets. With this new milestone added to our track record, we look forward to capitalizing on this momentum and unlocking opportunities for clients across the GCC,” he added.
Once new KFH shares are listed in Bahrain Bourse, AUB shareholders with shares listed in Bahrain will receive their new KFH shares tradeable on the Bahrain Bourse (and priced in USD), while AUB shareholders with shares on Boursa Kuwait will receive their new KFH shares tradeable on Boursa Kuwait. New KFH shares will be allotted to accepting shareholders effective 2 October 2022 and will commence trading on the morning of 6 October 2022.
Shareholders who have accepted the offer and wish to trade on the cross-listing date should speak to a broker ahead of trading to ensure validity of documents and accounts.
SICO is a leading regional asset manager, broker, market maker and investment bank, with USD 4.4 bn in assets under management (AUM). Today SICO operates under a wholesale banking licence from the Central Bank of Bahrain and also oversees two wholly owned subsidiaries: an Abu Dhabi-based brokerage firm, SICO Financial Brokerage, a specialised regional custody house, SICO Fund Services Company (SFS). SICO also oversees a majority-owned subsidiary, SICO Capital, a Saudi-based investment banking company. Headquartered in the Kingdom of Bahrain with a growing regional and international presence, SICO has a well-established track record as a trusted regional bank offering a comprehensive suite of financial solutions, including asset management, brokerage, investment banking, and market making, backed by a robust and experienced research team that provides regional insight and analysis of more than 90 percent of the region’s major equities. Since inception in 1995, SICO has consistently outperformed the market and developed a solid base of institutional clients. Going forward, the bank’s continued growth will be guided by its commitments to strong corporate governance and developing trusting relationships with its clients. The bank will also continue to invest in its information technology capabilities and the human capital of its 100 exceptional employees.
Ms. Nadeen Oweis
Head of Corporate Communications, SICO