Malaysia Building Society (MBSB) has agreed to acquire Asian Finance Bank (AFB) in a stock-cash deal worth MYR645m ($152.5m).
MBSB, whose controlling shareholder is the Employees Provident Fund (EPF), signed a conditional share purchase agreement with AFB shareholders, namely Qatar Islamic Bank, Financial Assets Bahrain, RUSD Investment Bank and Tadhamon International Islamic Bank for the deal.
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“The merged entity is expected to leverage on the strength of MBSB’s business and the banking license held by AFB is anticipated to provide a unique opportunity for the merged entity to emerge as a full-fledged Islamic banking franchise in Malaysia,” MBSB said in a statement.
To pay for the deal, MBSB will offer MYR396.9m ($93.95m) in cash and issue 225.5 million new shares.
Following the merger of the two entities, EPF’s share in MBSB will be reduced to 63.16% from 65.56%. Qatar Islamic Bank will own 0.73% stake in the combined entity, RUSD Investment Bank will own 1.83% and Tadhamon will hold a stake of 1.1%.
The deal is expected to close by the first quarter of 2018, subject to regulatory approvals.
