MANAMA/December 15-2020: The Bank of Bahrain and Kuwait (BBK’s) plan to acquire Ithmaar Bank has reached another milestone as the Ithmaar Holding has appointed KPMG as the financial advisors and Hassan Radhi & Associates as the legal advisors in respect of the much-trumpeted acquisition plan.
Apart from the acquisition of Ithmaar Bank operations in Bahrain, the plan has also included the acquisition of certain assets of IB Capital, both wholly owned subsidiaries of Ithmaar Holding.
Initial work already on
A statement said the initial preparation/work has commenced with both the financial and legal advisors. BBK and Ithmaar Holding executed the MoU related to this acquisition plan on September 14, 2020.
The scale of financial transaction involved in the BBK’s plan to acquire Ithmaar Bank still remains undisclosed. It was in August, the two banks announced that they were conducting initial talks about the potential acquisition.
Benefit from synergy
The plans are subject to shareholder and regulatory approvals and the completion of due diligence from both the parties. It is believed that Ithmaar Bank can also benefit from the deal in terms of capitalising on growth opportunities available from the acquisition by BBK.
The acquisition is expected to help in the expansion of BBK’s operations in Bahrain and add a full-service Islamic banking solution under its fold.
It is also expected to strengthen the established brand of Ithmaar Bank and position it to better capitalise on growth opportunities.
Earlier, when the talks regarding the acquisition had just started, the BBK chairman Murad Ali Murad had observed that his bank had long played a key leadership role in the Kingdom of Bahrain’s banking and financial services industry.
“To maintain this leadership role, and as part of its on-going business expansion strategy, BBK has been exploring opportunities to expand its business and diversify its offerings, particularly in Sharia-compliant banking businesses,” Ali Murad had said.
In August, Ithmaar Holding had reported a net loss attributable to equity holders of $1.29 million for the six-month period ended 30 June 2020 compared with $8.37 million it had posted for the same period a year earlier..