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Kuwait Al-Ahli Bank acquires 98.5 pct of Piraeus Bank Egypt shares

KUWAIT, May 23 (KUNA) -- Al-Ahli Bank of Kuwait (ABK) announced Saturday that it has acquired 98.5 percent of Piraeus Bank Egypt (PBE) shares for USD 150 million, subject to obtain approvals by the Central Bank of Kuwait and the Central Bank of Egypt.
The signing of this agreement marks the successful conclusion of the negotiations between ABK and PB with regards to the transaction and due diligence process as approved by the Central Bank of Egypt, ABK said in a statement, noting that the closing of the transaction is expected to take place before the end of 2015.
ABK's acquisition of Piraeus Bank Egypt realizes ABK's regional vision, especially with PB's visible presence in the Egyptian banking market via 39 branches in key population centers, in addition to its easily scalable system infrastructure, said the statement.
The capital adequacy ratio is 14 percent, with 56 percent loans/deposits ratio of highly liquid balance sheet at the end of March 31, 2015, ABK noted.
Following the consummation of the transaction, ABK shall become the second Kuwaiti bank to operate in Egypt and its entry shall provide it with ample opportunities to capture the deep relationship between the two countries both on the government level but also on the private sector level, the Kuwaiti bank said.
Meanwhile, ABK's Chairman Talal Behbehani emphasized in his bank's aspirations as a leading Kuwaiti bank to advance the fortress relationship, trade links, and financial integration between Kuwait and Egypt, according to the statement.
"We are delighted with this transformative transaction opening a new chapter in ABK's international strategy providing us significant footprint in one of the largest and fast-growing markets in the MENA region in addition to our existing stronghold in Kuwait and UAE," Behbehani said in the statement.
ABK has been advised by J.P. Morgan as its exclusive financial advisor on the acquisition of PBE, while Ernst and Young acted as transaction and tax advisors and Zulficar and Partners acted as legal advisors.
Established in 1967, ABK is a leading commercial and retail bank in Kuwait with market capitalization in excess of US 2.0 billion, total assets of US 11.9 billion, net loans of US 8.3 billion, and customer deposits of US 6.6 billion as of December 31, 2014.
PBE was founded in 1978 initially under the name of Alexandria Kuwait International Bank and in 1997 renamed as Egyptian Commercial Bank. Following a capital increase of EGP 500 million in May 2005, Piraeus Bank acquired 87.9 percent of the bank's shares and changed the bank's name to Piraeus Bank Egypt. In 2014, Piraeus Bank increased its stake to the current level of 98.5 percent. (end) fnk.tab.ma