AHLI UNITED BANK (AUB) INCREASE STAKE IN BANK OF KUWAIT & THE MIDDLE EAST (BKME) TO 75%.
Ahli United Bank BSC (AUB) announced that it has completed the acquisition of 138.2 million shares or 19.6% of the issued capital of the Bank of Kuwait & the Middle East KSC (BKME), one of the leading commercial banks in Kuwait. This acquisition is part of a major transaction involving the exchange of 208.2 million shares, representing 29.6% of the issued capital of BKME, of which 70 million shares, 9.9% of the issued capital, were acquired by BKME’s treasury and the balance were directly purchased by AUB. The transaction has a total value of KD 124.1 million (US$ 427.9 million).
Following this transaction, AUB’s effective holding in BKME becomes 75%.
BKME provides a full range of commercial and retail banking services. It has a 10 percent market share in Kuwait. BKME achieved a net profit of KD 15.3 million (US$ 52.7 million) in the six months to 30 June 2005, a growth of 34.4 percent over corresponding period in the previous year. Total assets of BKME amounted to KD 1,542 million (US$ 5,317 million) as of 30 June 2005.
“The acquisition represents an important milestone in Ahli United Bank’s strategy to become a major regional bank in the Gulf by securing a significant presence in Kuwait, to complement its existing large operations in Bahrain and in Qatar through AUB and Ahli Bank Q.S.C. respectively” said Fahad Al-Rajaan, Chairman of Ahli United Bank.
He added, “As a result of this additional stake, BKME will be fully consolidated from a financial and management perspective into the AUB Group. This will result in a significant improvement in performance through enhanced marketing and product development as well as from economies of scale.”
Mr Al-Rajaan concluded by saying “The acquisition of a 75% stake has involved a long process over 3 years and reflects AUB’s determination to secure a significant presence in one of its major targeted GCC markets.”