Qatar Commercial seeks 34pc stake in UAB
London, August 19, 2007
Commercial Bank of Qatar said its bid for a stake in Abu Dhabi-listed United Arab Bank is similar in scale to its 34 percent purchase in an Omani lender in 2005.
Qatar's second-largest bank by market value said on Thursday it had reached initial agreement with 'major' shareholders of United Arab Bank to buy a 'significant' stake in the Sharjah-based lender.
'You should not be looking for very much deviation to what we did in Oman, at an absolute minimum,' Commercial Bank chief executive officer Andrew Stevens told Reuters by telephone from Britain. He declined to give further details.
Commercial Bank, seeking to expand outside its home market where competition is intensifying as rivals grow and more lenders enter the market, bought 34 percent of National Bank of Oman in 2005, its first foreign purchase.
A 34 percent stake in United Arab Bank would cost about 1.8 billion dirhams ($490.1 million), based on its Aug 13 closing share price of 7.43 dirhams each and outstanding stock of 711.72 million on March 21, according to Reuters data.
United Arab Emirates law prevents foreign lenders owning more than 49 percent of local banks.
Stevens said due diligence on United Arab Bank, final agreement over terms and central bank approval would probably take until October.
Set up in 1975 with help from France's Societe Generale, United Arab Bank operates nine branches in the UAE, including three in Dubai and one in Abu Dhabi, where it listed its shares in 2005 after Societe Generale sold out.
The bank's biggest shareholder, according to data on the Web site of the UAE Securities and Commodities Exchange, is Sheikh Faisal Sultan Salem al-Qassimi, a member of the Sharjah ruling family. He owns 13.04 percent of the bank. - Reuters