First Abu Dhabi Bank makes offer to acquire majority stake in EFG Hermes Holding

UAE lender First Abu Dhabi Bank has made a non-binding offer to EFG Hermes Holding (EFG Hermes) for a potential cash acquisition of a majority stake, the latter announced today.

The proposed stake would be no less than 51 per cent of the issued shares of the company at an indicative purchase price of EGP19 ($1.21) per share.

The completion of the transaction and the final purchase price is conditional upon the completion of due diligence on the company, and the receipt of the regulatory approvals, EFG Hermes said in a statement. Post that, a mandatory tender offer will be made to all shareholders of the company, in accordance with Law 95 of 1992 and its executive regulations, it added.

The offer has been shared with the board of directors and will be discussed subsequently. Disclosures will be made in due course of time, the statement noted.

EFG’s stock has rebounded almost 40 per cent since last year’s low in August, giving the bank a market value of $924m, according to data compiled by Bloomberg. EFG is a major adviser on initial public offerings at home across the Middle East and North Africa. It has operations in 13 countries on four continents, according to its website.

FAB reported a group net profit of Dhs12.5bn for 2021, up 19 per cent year-on-year. Its net profit for Q4 2021, however, totaled Dhs3.3bn, up 3 per cent year-on-year.

Read: First Abu Dhabi Bank reports 19% rise in group net profit for 2021

Towards the end of last year, FAB also received a financial license from the China Banking and Insurance Regulatory Commission Shanghai Office to open a branch in Shanghai.

Read more: UAE’s First Abu Dhabi Bank to open first mainland China branch

With inputs from Bloomberg