Ahli in takeover reservations

Bahrain's Ahli United Bank has reservations about opening its books to takeover suitor International Bank of Qatar (IBQ), its second-biggest shareholder said on Saturday.

Tamdeen Investment Co., which holds a 13 percent stake in Ahli United, asked the Bahraini lender to allow IBQ to conduct due diligence on the bank in a $6.1 billion takeover bid that would be the biggest cross-border takeover of a Gulf firm.

But Ahli United has expressed reservations about IBQ's due diligence process, which it said could violate its interests if no deal is reached, Tamdeen said in a statement on the Kuwait bourse Web site.

Tamdeen and investors it represents had accepted in principle an offer to sell a 55 percent stake in Ahli United at $2.25 per share to IBQ, Ahli United said last week.

"Ahli United Bank sees a contradiction (in the due diligence process) with standard practices ... and with its interests in particular in case the deal is not concluded," Tamdeen said.

Ahli United's reservations included objections to the direct involvement of IBQ officials, rather than neutral third parties, in the due diligence process, Tamdeen said.

Tamdeen has informed the Qatari lender about Ahli United's position on the due diligence process and expected a response by the end of this week, it added, without giving details.

Tamdeen and its parent firm Tamdeen Real Estate Co. could not be reached for comment.

The Kuwait stock exchange halted trading in shares of Ahli United Bank, Tamdeen and Tamdeen Real Estate Co. on requests of the three firms.

Shares of Ahli United had surged more than 5 percent in early trading before they were halted. The bourse later cancelled all of the day's trades in the stock.

BIGGEST GULF DEAL

More Gulf Arab banks are looking for mergers and acquisitions to gain the scale to cope with regional demand for credit, which has been spurred by economic growth and government investment of windfall oil revenue in infrastructure.

Emirates Bank International Ltd. and National Bank of Dubai earlier this month announced details of an $11.3 billion, government-initiated deal that would combine them into the Gulf's largest lender by assets, called Emirates NBD. In a statement, Ahli United said it had been informed about the "latest developments" regarding IBQ's offer, but did not elaborate.
Ahli United said last week IBQ, an affiliate of National Bank of Kuwait, had also offered to buy the remaining 45 percent in stock.

Tamdeen has not identified the shareholders it represents.

The bank's third-biggest shareholder, the Bahrain government's Pension Fund Commission, which owns 10 percent, said on July 30 it was not among investors that had accepted the Qatari lender's bid.

Kuwait's Public Institution for Social Security owns around 20 percent of Ahli United. Its deputy director, Sheikh Abdullah Jaber al-Ahmad al-Sabah, could not be reached for comment on Saturday.

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