Abu Dhabi Commercial Bank (ADCB) will record a net profit of
AED1bn ($272.3m) from the sale of its 25 percent stake in Malaysian lender RHB
Capital, the lender said Sunday.
ADCB signed an agreement to sell its percent stake in RHB
Capital to Aabar Investments, an Abu Dhabi investment fund, for 10.80 ringgit
per share, bringing in AED7bn ($1.91bn).
"After considering all related costs... exchange rates,
hedging, cost of funding etc... this transaction shall contribute approximately
AED1bn to the bank's overall profit," ADCB said in a bourse statement.
The lender, one of the region's most exposed banks to indebted
conglomerate Dubai World, said it will use proceeds of the stake sale to
bolster its balance sheet and will help the bank focus more on its local
Consideration for the sale will be settled in cash, one
month from the date of signing the agreement, ADCB said.
RHB, Malaysia's fifth-largest lender with a market value of
about $7.2bn, is presently a takeover target of Malaysia's two largest banking
groups, CIMB Group and Malayan Banking (Maybank).
Analysts have said the sale to Aabar could complicate a
merger bid between RHB and either CIMB or Maybank as it set the floor for the
RHB takeover, pricing RHB at a minimum 2.25 times book value. RHB's book value
was 4.79 ringgit per share as of March 31.
Shares in ADCB gained 2.2 percent amid low volumes in Abu
Dhabi trade as at 0700 GMT
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