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Alawwal, SABB merger talks reach advanced level

Alawwal, SABB merger talks reach advanced level
The deal includes completion of confirmatory due diligence
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Riyadh – Mubasher: Alawwal Bank and the Saudi British Bank (SABB) on Wednesday announced that their merger talks reached an advanced stage.

The boards of both banks have reached a preliminary, non-binding agreement on the share exchange ratio, according to a filing to the Saudi Stock Exchange (Tadawul).

The deal includes completion of confirmatory due diligence, finalisation of the merger agreement and agreement on a number of other commercial issues, the two Saudi Arabia-based lenders noted.  

Under the agreement, Alawwal Bank's shareholders would receive 0.485 SABB shares for each Alawwal Bank share.

The merger would value each Alawwal bank share at SAR 16.3 and Alawwal bank's existing issued ordinary share capital at approximately SAR 18.6 billion, the filing showed. 

“[Merger] would represent an important transaction in the context of developing the Banking Sector of Saudi Arabia, this being a key objective of the financial sector development program under Vision 2030,” according to the statement.

This transaction includes related parties, the details of which will be announced in due course, the two banks said. 

“Alawwal bank does not expect that the proposed merger will, if completed, result in any involuntary layoff of employees,” Alawwal commented.