RHB Capital Berhad cancelled the acquisition of 40% stake in PT. Bank Mestika Dharma Tbk.
June 30, 2014 at 09:30 am IST
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RHB Capital Bhd (KLSE: RHBCAP) entered into a conditional sale and purchase agreement to acquire 80% stake in Bank Mestika for IDR 3.1 trillion in cash on October 19, 2009. Under the terms of the deal, RHB Capital will acquire 0.65 million shares of Bank Mestika. The deal will be financed from the proceeds of the proposed rights issue of RHB Capital. RHB Capital also entered into an option agreement to acquire an additional 9% stake in Bank Mestika which will take place after the proposed initial public offering of Bank Mestika. In addition, RHB Capital will also undertake rights issue of new RHB capital Shares and increase in its authorised capital. RHB Capital also entered into an agreement with Hongkong and Shanghai Banking Corporation Limited to act as escrow agent for IDR 311.83 billion which will be refunded if the acquisition falls through.
For the year ended December 31, 2008, Bank Mestika had net profits of IDR 169.8 billion and net assets of IDR 1.1 trillion. The deal is subject to approval by the shareholders of Bank Mestika at the Annual General Meeting, all approvals and consents of RHB Capital shall have been obtained, approval of the Minister of Law and Human Rights of Indonesia for any amendments to the articles of association of Bank Mestika, approval by Bank Negara Malaysia and Bank of Indonesia and closing of the initial public offering of Bank Mestika. As of January 4, 2010, Bank Negara Malaysia approved the transaction.
The deal is expected to close in the second quarter of 2010. The acquisition is not expected to have any material effect on the issued and paid-up share capital of RHB Capital and is expected to contribute positively to the future revenue and earnings of RHB Capital Group.
The deal had received Bank Negara Malaysia's approval in January 2011, while the rights issue for the acquisition of Bank Mestika also had been approved by the Securities Commission and shareholders. RHB expects to complete the acquisition in the third quarter of the year 2011. As on April 19, 2012, the approval from Bursa Malaysia Securities Berhad for the extension of time of up to April 19, 2012 to complete the implementation of the rights issue will lapse. RHB will resubmit an application to Bursa Securities for the implementation of the rights issue upon obtaining the necessary regulatory approvals for the proposed acquisition.
As of June 29, 2012, RHB Capital and Bank Mestika mutually agreed to further extend the period to satisfy or waive the conditions precedent of the conditional sale and purchase agreement for the acquisition to November 30, 2012. As of December 3, 2012, RHB Capital and Bank Mestika mutually agreed to further extend the period to satisfy or waive the conditions precedent of the conditional sale and purchase agreement for the acquisition to January 31, 2013.
As per amended agreement on January 30, 2013, RHB Capital Bhd will acquire 40% stake in PT Bank Mestika Dharma for IDR 2.1 trillion. RHB Capital will acquire 0.33 million shares of Bank Mestika. As on October21, 2009, a deposit of IRD 0.31 trillion was paid, the remaining IRD 1.8 trillion will be paid on completion. The revised consideration will be funded by RHB Bank's internally generated funds and/ or equity financing. RHB Bank terminated the option agreement to acquire additional 9% stake in Bank Mestika after proposed IPO. The transaction is expected to be completed in the second quarter of 2013. As of June 26, 2013, RHB Capital and Bank Mestika mutually agreed to further extend the period to satisfy or waive the conditions precedent of the conditional sale and purchase agreement for the acquisition to September 30, 2013. As of September 27, 2013, RHB Capital and Bank Mestika mutually agreed to further extend the period to satisfy or waive the conditions precedent of the conditional sale and purchase agreement for the acquisition to December 31, 2013. The acquisition not expected to have any material effect on the earnings and EPS of RHB Banking Group for the financial year ending December 31, 2013.
The completion of the transaction is postponed and is now expected to close in fourth quarter of 2013. The transaction is expected to close by the beginning of the fourth quarter of 2013. The transaction is expected to be completed in 2014. The transaction is expected to close by June 30, 2014.
CIMB Investment Bank Berhad, RHB Investment Bank Bhd and Piers Willis, Larry Sutikno, Horace Chan, Gavin Chan, Adrian Mak, Oqi Averdi, Alexis de Ponsay and Silvia Tjioe of Rothschild Malaysia Sdn Bhd acted as the financial advisor for RHB Capital Bhd.
RHB Capital Berhad (KLSE:RHBCAP) cancelled the acquisition of 40% stake in PT. Bank Mestika Dharma Tbk (JKSE:BBMD) on June 30, 2014. RHB Capital failed to receive approval from Indonesia's Financial Services Authority and thus failed to fulfill conditions for the sale and purchase agreement expiring on June 30, 2014.
PT Bank Mestika Dharma Tbk (the Bank) is an Indonesia-based company, which is engaged in banking services. The Bank conducts business activities in general banking, financial and insurance activities. It is involved in accepting deposits and/or closing deposits and granting credit or loan funds. Its products include Setia Savings, Mestika Savings, Kesra Savings, My Savings, and Student Savings. It offers multipurpose loan, housing loan, mobile car loan, land loan, working capital loan, bank guarantees, and trade finance. Its banking services include Internet banking, mobile banking, SMS banking, virtual account, transfers, safe deposit box, money changer, telegraphic transfer, Western Union, import taxes payment, bills payment, payroll, and taxes payment. Its Bancassurance products consist of Income Protection, Insurance Dynamic Enchanced Auto Navigation Link Income Protection 100, ProFuture, and ProOptimal.