Alizz islamic shows interest in merger with United Finance

Muscat - 

Alizz islamic bank has shown interest in the possibility of a strategic merger with United Finance Company.

‘Alizz islamic bank wishes to disclose that it has expressed interest in the possibility of strategic merger with United Finance subject to conducting due diligence’, the bank said in a filing to the Muscat Securities Market (MSM) on Tuesday.

United Finance, in a separate disclosure, confirmed the receipt of a communication from alizz islamic bank proposing the possibility of a merger.

‘The proposal from alizz islamic bank has been forwarded to the board of United Finance for their information and directions. Further disclosure concerning this matter will be made as and when there are developments to report’, United Finance said.

Alizz islamic bank added that no legally binding commitment has been made and the transaction remains subject to approval by the regulators and other stakeholders. Shares of alizz islamic bank closed 2.3 per cent higher on Tuesday at the MSM.

Before alizz islamic bank’s interest in United Finance, Bank Nizwa in 2015 had proposed a strategic merger with United Finance, which was followed by rival offers from Al Omaniya Financial Services Co and National Bank of Oman (NBO).

However, following United Finance’s invitation to all three suitors to participate in a bidding process in 2015, Bank Nizwa and NBO withdrew their proposals. And after months of discussions on a proposed merger/acquisition between United Finance and Al Omaniya, both the non-banking finance companies had also decided not to pursue the transaction any further.

United Finance’s total assets stood at RO117.82mn as of March 31,2017 while its loan portfolio was at RO112.85mn. The company’s net profit declined to RO757,000 in the first quarter of this year compared with RO1.15mn in the corresponding period of last year.

Alizz islamic bank’s total assets stood at RO463.54mn as of March 31, 2017. The bank’s financing receivables reached to RO361.24mn as of March 31, 2017 while deposits grew to RO374.04mn.

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