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MANILA, Philippines -- San Miguel Corp. (SMC) on Tuesday said it sold its stake in Bank of Commerce to CIMB Group of Malaysia.
In a statement, SMC said San Miguel Properties Inc., along with the bank's shareholders San Miguel Corp. Retirement Plan and Q-Tech Alliance Holdings Inc., sold up to 65.08 million in fully-paid ordinary shares, equivalent to a 58 percent equity interest in the bank.
Including the shares of other minority shareholders, the CIMB Group will purchase 67.33 million fully-paid ordinary shares, representing 59.98 percent of the total issued and paid-up capital of the bank, at a price of P181.25 apiece for a total consideration of approximately P12.20 billion, the CIMB Group said in a disclosure to the Bursa Malaysia.
The completion of the sale is subject to certain closing conditions, including the mandatory approvals from the Monetary Board of the Bangko Sentral ng Pilipinas and the Bank Negara Malaysia.
CIMB Bank Berhad is a 99.99 percent subsidiary of the CIMB Group Sdn Bhd. of Malaysia, the second largest financial services provider in Malaysia with operations across eight Asean countries.
The acquisition will provide the Malaysian group with the opportunity to enter into the commercial banking business in the Philippines.
“As an Asean universal bank, this extension to the Philippines is a very natural one. I believe we are entering this market at the right time, with the right deal and right partner,” said Dato’ Sri Nazir Razak, CIMB Group chief executive.
The CIMB Group is upbeat about the long-term prospects of the Philippine economy – it being the fifth largest in Asean and the second largest by population.
BanCom is the Philippines' 16th largest lender with assets of P90.7 billion, but “it can grow quickly with its low loan-to-deposit base and high capital ratios,” Nazir said.
“On the wholesale side, we see the immediate potential of delivering banking and capital markets solutions to corporates. The consumer segment will take us a little more time and investment overall but we can get our remittance proposition up and running quickly. The most exciting part though is the access to the SMC ecosystem which is a huge community of SMC entities as well as suppliers and partners,” he said.
In conjunction with the acquisition, CIMB Bank has also entered into a collaboration agreement with SMC for the continued support to BanCom. SMC Retirement Plan will remain the largest minority shareholder of the bank at 27 percent.
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