BIMB gets extension to finish talks on stake buy

by **Cals** Sun 30 Jun 2013, 01:43

Saturday June 29, 2013
BIMB gets extension to finish talks on stake buy

PETALING JAYA: BIMB Holdings Bhd has received a further one-month extension till end-July to complete negotiations with Dubai Financial Group LLC (DFG) on the acquisition of the latter’s 30.5% stake in Bank Islam Malaysia Bhd.

In a filing to Bursa Malaysia yesterday, BIMB said that Bank Negara had extended the deadline for the negotiations between BIMB, DFG and Lembaga Tabung Haji (LTH) on the Bank Islam stake to July 31.

“Bank Negara had no objections for the extension of time from June 30 to July 31, following which a formal approval for the proposed acquisition as mutually agreed among the parties shall be sought,” it said.

StarBizWeek had earlier reported that it was believed that BIMB’s acquisition of DFG’s 30.5% stake was almost completed, with valuation and pricing parameters having been somewhat determined.

BIMB is Bank Islam’s largest shareholder with a 51% stake, while another 18.5% is held by LTH – BIMB’s parent company.

LTH, meanwhile, owns a 51.5% stake in BIMB.

BIMB is also seeking to purchase LTH’s stake in Bank Islam and has until Dec 31 to negotiate the proposed acquisition.

If the acquisitions from DFG and LTH are successful, then BIMB would end up with a 100% stake in Bank Islam.

To own its unlisted banking unit Bank Islam in its entirety, BIMB might have to fork out RM2.7bil for the remaining 49% stake it does not already own.

According to Maybank Investment Bank Research, the price tag, based on a 1.8 times price-to-book value, may possibly lead to a rights issue.