Hwang-DBS sells 51% stake in unit to AFG

by **Cals** Mon 07 Apr 2014, 01:35

Published: Friday April 4, 2014 MYT 12:00:00 AM
Updated: Friday April 4, 2014 MYT 5:38:45 PM
[size=40]Hwang-DBS sells 51% stake in unit to AFG[/size]
KUALA LUMPUR: Hwang-DBS (M) Bhd (HDBS) is selling its 51% stake in its equity research unit to Alliance Financial Group Bhd (AFG) for RM393,945 cash.
HDBS said the disposal was undertaken following the sale of HwangDBS Investment Bank Bhd (HwangDBS) to Affin Holdings Bhd. The company is in the midst of completing the sale.
It said, with the disposal of its investment banking business, the company “no longer required research services”.
On March 27, Hwang-DBS obtained shareholders’ approval to sell its investment banking business to Affin for RM1.36bil.

In a filing with Bursa Malaysia yesterday, AFG said Alliance Investment Bank Bhd (AIBB), a wholly-owned subsidiary of Alliance Bank Malaysia Bhd, which in turn is a wholly-owned subsidiary of AFG, had entered into a conditional share sale and purchase agreement with HDBS for the acquisition of the 51% stake in HwangDBS Vickers Research Sdn Bhd (HDBSV).
DBS Vickers Securities Holdings Pte Ltd (DBS Vickers) is the remaining 49% shareholder in HDBSV. HDBS said the disposal was expected to be completed by the second quarter.
AFG said the acquisition would enhance the group’s equity research capabilities and its institutional broking business by leveraging on DBS Vickers’ network of overseas clients to execute their trades on Bursa Malaysia via AIBB to further expand the group’s investment banking business, especially the stock-broking institutional business.
“In addition to providing coverage on Malaysian equities, the group will be able to leverage on the capabilities of HDBSV to provide coverage on the regional equities for its institutional clients,” it added.
AFG said the purchase consideration was arrived at on a willing-buyer, willing-seller basis after taking into consideration the aggregate net assets of HDBSV amounting to RM772,441 based on its audited financial statements for the financial year ended July 31, 2013.
Upon completion of the integration, the equities research business of AFG will be operated under HDBSV on a 51:49 joint-venture basis with DBS Vickers, to be renamed AllianceDBS Research Sdn Bhd.