You are hereHome SectorsUAE
Abu Dhabi's Finance House to buy CAPM
Source: BI-ME with Reuters , Author: Posted by BI-ME staff
Posted: Thu March 22, 2012 6:14 pm

UAE. Abu Dhabi-listed Finance House is to buy privately-owned investment bank CAPM Investment to expand into investment banking and asset management, three sources familiar with the matter said on Thursday.

Under an agreement between the two parties, Finance House will acquire CAPM's investment banking and asset management licence, offering a premium of between 5 to 10 percent to the value of those businesses, one of the sources said speaking on condition of anonymity.

CAPM was capitalised at 100 million dirhams ($27.2 million). Its liquid assets are estimated at around 40 million dirhams while the brokerage business is valued at around 55 to 60 million dirhams, the source said. However, the brokerage business is excluded from the deal as it will be wound up.

"It is a done deal between the two companies. The UAE Central Bank's approval is awaited," a second source said speaking on condition of anonymity.

"The acquisition helps Finance House to complete its portfolio and offer investment products, advisory etc under the investment bank umbrella," the source added.

A third source said Finance House was most likely to merge CAPM with its DIFC-based (Dubai International Financial Centre)unit, Finance House Capital, although a final decision on this is yet to be taken.

The sources declined to be named as the deal has not been made public yet. Finance House officials declined to comment. A CAPM official, who declined to be identified, said the company's shareholders approved the sale on Monday.

Investment banks and brokerages in the Gulf Arab region are under pressure to consolidate as slumping market turnover and weak asset values put their survival in doubt.

Ninety brokerages are licenced to trade the two domestic bourses in the United Arab Emirates, Dubai Financial Market and Abu Dhabi Securities Exchange, according to the Securities and Commodities Authority.

But this number may now have fallen by more than half as many of them have asked for their licences to be suspended or have shut themselves down completely, securities analysts say

 

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

date:Posted: August 21, 2014
INTERNATIONAL. The report found there are 15 million middle-class households in 11 of sub-Saharan Africa's top economies this year, up from 4.6 million in 2000 and 2.4 million in 1990, an increase of 230% over 14 years.
date:Posted: August 21, 2014
UAE. "The establishment of QIFs aimed at sophisticated, high-net worth investors is a welcome development which reflects the fact that a one size fits all approach to regulation is not appropriate."
date:Posted: August 20, 2014
UAE. Rising geopolitical tensions and slowing global growth; GCC markets remain steady in spite of increased global volatility; Commodity prices soft on China bank data.
INTERNATIONAL. U.S. special operations forces made a failed attempt to rescue journalist James Foley and other Americans held hostage by Islamic extremists in Syria earlier this summer, the White House said in a statement.
dhgate