Lebanon’s Bank Audi and First Abu Dhabi Bank (FAB) signed, on Wednesday, a definitive agreement for selling 100% of the share capital of Bank Audi’s subsidiary in Egypt to the FAB.
This agreement follows the completion of an in-depth due diligence exercise conducted by the FAB on Bank Audi Egypt after obtaining the preliminary approval of the Central Bank of Egypt (CBE).
The transaction is expected to be completed within the next few months, following the satisfaction of customary conditions, including the receipt of regulatory approvals in the UAE and Egypt. Any further updates with regards to the completion of the transaction shall be provided in due course.
André Sayegh, Group CEO at the FAB, said, “The FAB has a long history in Egypt, having opened its first branch in the country more than 45 years ago. The Bank’s first international acquisition accelerates the Group’s expansion in a high potential market, with the addition of Bank Audi Egypt’s operations offering the scale, expertise and financial strength to support our growth journey and sustainable returns. The FAB is committed to supporting customers in Egypt across a full range of retail and corporate banking needs, as well as serving as a bridge for trade and investment flows across the MENA region and beyond.”
Samir Hanna, Chairperson and Group CEO of Bank Audi, stated, “This transaction represents the best outcome for all our constituencies, in particular our customers and our employees in Egypt based upon the challenges we have been facing in Lebanon for the past 16 months.”
He added, “This transaction also represents a strong vote of confidence in the effectiveness of the Group’s governance and business model across the region.”
This acquisition will significantly increase the size and scale of the FAB’s operations in Egypt, making it one of the country’s largest foreign banks by assets with pro-forma total assets of more than EGP 120bn ($8.1bn). The proceeds of the sale will contribute to the enhancement of Bank Audi Group’s capitalisation and financial resilience.
At end-September 2020, Bank Audi Egypt had total assets of EGP 83.2bn ($5.3bn) and shareholders’ equity of EGP 7.6bn ($479m). Its established Retail and Corporate Banking propositions, and network of 53 branches, complement FAB’s well-established operations in Egypt of 17 branches and a presence dating back to 1975.
The FAB and UBS AG (London Branch) acted as financial advisers, while Freshfields Bruckhaus Deringer LLP and Matouk Bassiouny & Hennawy acted as legal advisers to the FAB on the transaction.
EFG Hermes acted as sole financial adviser, while Dechert LLP and Zulficar and Partners acted as legal adviser to Bank Audi on the transaction. JPMorgan rendered a Fairness Opinion to Bank Audi, while Broadgate Advisors offered advisory services to Bank Audi in connection with the transaction.