Bahrain, 21st January, 2009 -
Burgan Bank & UGB deal continues
“Burgan continues its regional expansion,” says Burgan Chairman
“We’re confident the deal will be completed,” says UGB’s Managing
Director
Kuwait City, 21st January, 2009:
Burgan Bank and United Gulf Bank have announced that they will
continue to implement the transaction in which Burgan will purchase
three regional commercial banks from United Gulf Bank (UGB).
Burgan Bank’s regional expansion strategy - announced at its 39th
Annual General Assembly and 22nd Extraordinary General Assembly in
2008 - involved the purchase of Jordan Kuwait Bank, Algeria Gulf
Bank, Bank of Baghdad and Tunis International Bank from UGB. The
deal was to be funded by a capital increase by Burgan Bank.
Having obtained the necessary regulatory approvals, Burgan Bank
successfully completed the purchase of UGB’s 43.86% stake in Jordan
Kuwait Bank in 2008. This took Burgan’s total stake in Jordan Kuwait
Bank to 51.1%, which was consolidated on 30th September, 2008 on a
basis that complied with Burgan’s Capital Adequacy obligations.
However, because the Decree of H.H. the Amir of Kuwait authorizing
the increase in the capital of Burgan Bank was not granted by the
31st December 2008 deadline imposed by the Central Bank of Kuwait
for UGB to subscribe to the new shares, the transaction involving
the three other banks has been unavoidably delayed.
Both Burgan Bank and UGB said it is their firm intention to pursue
the transaction and that they will adhere to all the necessary
procedures so that the deal can be completed as quickly as possible.
This process will require a number of new procedures and approvals
from regulators and other concerned authorities and as a
consequence, Burgan Bank shareholders will be approached in due
course to give the required endorsement at a General Assembly
meeting.
Burgan Bank Chairman, Mr. Tariq AbdulSalam, said:
“Despite this delay in completing the transaction with UGB, our
regional expansion plans will continue during the course of 2009. By
obtaining the necessary approvals and successfully completing the
transfer of UGB’s stake in Jordan Kuwait Bank last year, which gave
us majority control, we achieved the first step in our international
expansion programme. The acquisition of the other regional banks is
expected to be completed once the required Shareholder and other
consents are obtained.”
“As part of our vision to significantly accelerate stakeholder
value, Burgan Bank’s regionalization is a natural and positive step
forward in its evolution. With Jordan Kuwait Bank, Algeria Gulf
Bank, Bank of Baghdad and Tunis International Bank within our
network, Burgan will become a substantial regional force in
commercial banking,” he added.
UGB’s Managing Director, Mr Masaud Hyatt, said:
“We regret that the delay in obtaining the Amiri decree is causing a
delay in the finalization of the transaction between UGB and Burgan
Bank. We will continue to implement the necessary procedures to make
the deal happen, because we believe it is beneficial to both
institutions and the markets they serve. As a result, we are
confident the deal will be completed soon.”
- END -
Note to editors:
About Burgan Bank:
Burgan Bank is a
subsidiary of KIPCO (Kuwait Projects Company). The youngest and most
dynamic commercial bank in the State of Kuwait, established in 1977,
the Bank has acquired a leading role in the retail, corporate and
investment banking sector through innovative product offers and
technologically advanced delivery channels. It has continuously
improved its performance over the years by applying an expanded
revenue structure, good asset quality, diversified funding sources
and a strong capital base. The adoption of state-of-the-art services
and ground-breaking technology has positioned it as a trendsetter in
the domestic market. At present it enjoys a wide reach through our
network of 20 branches and over 80 ATM's making it one of the widest
ATM networks in the GCC.
The brand has been created on a foundation of real values – of
trust, commitment, excellence and progression to remind us of the
high standards to which we aspire. ‘People come first’ is the
foundation on which its products and services are developed and are
further augmented by its three pillars of innovative technology,
staff competency and customer service. It is committed to offering
an enhanced banking experience.
The Bank was recertified and is still the only bank in the GCC with
ISO 9001:2000 certification in all its banking businesses. It also
has to its credit the distinction of being the only bank in Kuwait
to have won the JP Morgan Chase Quality Recognition Award, 10th year
in succession and was also acknowledged as the ‘Best Local Private
Bank’ in Kuwait in the Fourth Annual Euromoney Private Banking
Survey 2007. Further, for two consecutive years, it was conferred
the COMMERZBANK Recognition Award, for maintaining high standards of
quality, efficiency and reliability while processing Euro currency
transactions as well. The Bank’s commitment to uphold best practices
was recognized when it won the region’s first Hawkamah-UAB Bank
Corporate Governance Award 2007 while its marketing excellence was
recognized as amongst the best in the region by the Middle East
Business Achievement Awards 2007.
It’s steadily improving financial performance was acknowledged by
Standard & Poor’s Ratings Services which revised its outlook on the
Bank from stable to positive in addition to affirming its 'BBB+'
long-term and 'A-2' short-term counterparty credit ratings on the
Bank. Further, Moody’s Investor Services also upgraded the Bank’s
FSR rating from D+ to C- recently Capital Intelligence too
acknowledged the improved financial profile and upgraded the Bank’s
Financial Strength Ratings from BBB to A-, the Foreign Currency
Short Term rating as A2 and the Foreign Currency Long Term rating
from BBB to A-
About
United Gulf Bank:
UGB, the investment banking subsidiary of Kuwait Projects Company
(Holding) (KIPCO), manages a regional network of investment/asset
management companies and commercial banks. Its proprietary
investments include assets in real estate, private equity,
structured products and quoted securities. As of March 2008 assets
under management exceed US$ 9.6 billion (year end 2007 US$ 8.5
billion). UGB’s core subsidiaries and associates include: Algeria
Gulf Bank, Al Dhiyafa Investment Company, Bank of Baghdad, Jordan
Kuwait Bank, KIPCO Asset Management Company (KAMCO), Manafae
Investment Company, Millennium Finance Corporation, Royal Capital
Company, Syria Gulf Bank, Tunis International Bank, United Cable
Company, United Gulf Bank Securities Company, United Gulf Financial
Services Company, United Industries Company, United Healthcare
Company and United Real Estate Company.
UGB and its subsidiary KAMCO have a proven track record of
successfully completing around 50 investment banking transactions
for its clients since 2001 with an aggregate value of over US$ 7
billion including corporate finance, advisory, new issue placement
and underwriting, corporate restructuring, bond issuance and merger
and acquisition.
The KIPCO Group is one of the biggest diversified holding companies
in the Middle East and North Africa, with assets worth more than US$
21 billion under management or control. The Group has substantial
ownership interests in a portfolio of over 50 companies employing
over 8,000 people operating across 21 countries. The company’s main
business sectors are financial services and media. Through the
subsidiaries and affiliates of its core companies, KIPCO also has
interests in real estate, industry, healthcare and the management &
advisory sector.
For
further information, please contact:
Burgan Bank:
Fadi Matar
General Manager & Chief Marketing Officer
Corporate Communications Group
Burgan Bank
Telephone: +965 2988400
Mobile: +965 7030069
Fax: +965 2988419
e-mail: fadim@burgan.com
web: www.burgan.com
UGB:
Telephone +973 17533233
email info@ugbbah.com
