Riyadh – Mubasher: The Saudi British Bank (SABB) and Alawwal bank have signed a binding merger agreement on Wednesday, 3 October.

The two Saudi lenders approved to carry out regulatory procedures for merger pursuant subject to articles 191-193 of the Companies Law and Article 49 (a) (1) of the Merger and Acquisition Regulations, according to a statement to the Saudi Stock Exchange (Tadawul) on Thursday.

Upon the deal’s completion, Alawwal Bank’s assets and financial commitments will be transferred to SABB, while its shares will be cancelled and new shares in SABB will be issued to its shareholders.

“If the merger is completed, Alawwal Bank shareholders will receive 0.48535396 new SABB shares for each Alawwal Bank share,” the statement added.

The new shares will be issued through capital hike, which will increase SABB’s paid-up capital by 37.0% to SAR 20.55 billion, from SAR 15 billion after raising its shares to 2.05 billion from 1.5 billion shares.

In May, the two banks stated that their merger discussions started in April 2017 have reached advanced stages.