KUWAIT CITY, April 1: The Kuwait Finance House (KFH) has recently notified the Competition Protection Authority (CPA) of its efforts to agree on the acquisition of Ahli United Bank (AUB) as part of the bank’s steps to comply with the required regulatory approvals, reports Al-Rai daily quoting elated sources.
The sources pointed out that by submitting an official request to the authority, the KFH has completed all the required regulatory communications in this regard, which included regulators in Kuwait and Bahrain represented by the Central Bank of Kuwait, the Central Bank of Bahrain and other regulatory bodies to obtain the necessary approvals to conduct studies and any other approvals that may be required.
The sources pointed out that in order to “protect competition” the opinion regarding the acquisition request, KFH should first conclude its investigation of the due diligence by each bank on the other, explaining that based on the results of these studies, the authority can express its opinion regarding the acquisition request that has been submitted. The sources pointed out that «protection of competition» is usually required of the applicant to acquire, determine the share of the new entity in the market, and the impact of this step on competition, both on the share of the new entity or the market, and the benefits of the merger of the operations of the banks, provided that the CPA gives its opinion within 60 working days. The sources indicated that KFH is the only one which is interested in submitting the acquisition request to PCA as the only local entity in the deal.
Ahli United Bank is not complying with this procedure as an external entity that has its own procedures at its regulatory bodies. The long-term acquisition is expected to take up to 30 months and will include all regulatory approvals, completion of the due diligence examination and evaluation of the acquisition offer by both banks’ boards of directors and their shareholders, the sources said.