16 Aug 2022
Al Ahli Bank of Kuwait and Gulf Bank have signed a Memorandum of Understanding regarding the proposed acquisition of one of the two banks over the other, with the possibility of converting one of the banks into a Sharia-compliant bank.
The Memorandum of Understanding referred to the formation of a joint advisory committee which is set to meet periodically. Among the committee’s tasks is to facilitate and assist in obtaining required internal approvals and to consider other essential matters, including the selection and appointment of the necessary advisors to provide advice for the benefit of both parties after obtaining the necessary approvals.
Al Ahli Bank of Kuwait
Mr. Talal Behbehani, Chairman of the Board of Directors at Al Ahli Bank of Kuwait, commented: “In light of the rapid developments witnessed by the banking industry both locally and globally, we found it appropriate to discuss the proposal submitted by both banks’ shareholders regarding the acquisition of one of the banks over the other, with the possibility of converting one of the banks into a Sharia-compliant bank. Furthermore, we also found it crucial to examine opportunities for a joint partnership between both banks in order to maintain their prestigious and distinguished positions.”
Mr. Behbehani pointed out that both Al Ahli Bank of Kuwait and Gulf Bank enjoy individual comparative advantages, with the acquisition deal marking a giant step in pursuit of an initiative that will augment performance, increase revenues, and enhance the value of shareholder equity and market share for both banks.
Mr. Jassim Mustafa Boodai, Chairman of the Board of Directors at Gulf Bank, commented: “The Memorandum of Understanding that was signed represents the first regulatory steps taken by both banks to consider a joint partnership and a potential acquisition deal with the aim of facilitating and expediting the necessary procedures to reach a final agreement.”
Mr. Boodai stressed the keenness of Gulf Bank's board of directors to study all available opportunities in pursuit of all shareholders’ interest, and to ensure transparency throughout every step of the process. He pointed out that the final approvals related to the proposed acquisition deal with Al Ahli Bank of Kuwait are subject to the approval of Gulf Bank's general assembly and local regulatory authorities.
It is noteworthy that the boards of directors of both Al Ahli Bank of Kuwait and Gulf Bank had agreed to start the due diligence work and obtain the required approvals from the Central Bank of Kuwait and regulatory authorities regarding joint cooperation and the proposed acquisition deal.