Maybank Takes over Singapore's Kim Eng Holdings

So the rumours have come true.

Maybank, through its wholly-owned subsidiary, Aseam Credit Sdn Bhd (ACSB), has proposed to acquire a 44.6% stake in Kim Eng Holdings Ltd today at S$3.10 per share. This means footing a bill for S$798mil or approximately RM1.9bil.

The conditional sale and purchase agreements was with Ronald Anthony Ooi Thean Yat and Yuanta Securities Asia Financial Services Ltd for the acquisition of 15.4% and 29.2% stakes respectively in Kim Eng.

Kim Eng is a leading stock broker in ASEAN with a top five position in Singapore, Thailand, Indonesia and the Philippines. It also has a presence in global financial centres, including Hong Kong, London and New York.

As of Sept 30, 2010, Kim Eng's total assets and shareholders' equity amounted to S$2.697bil and S$938 mil, respectively. Upon completion of the acquisition, Maybank will be required to make a mandatory general offer for the remaining 55.4% shares in Kim Eng, with an intention to privatise the company.
The total consideration for the acquisition of 100% of Kim Eng would amount to S$1.79bil (RM4.26bil).

The proposed transaction represents an acceleration of Maybank's investment banking and equities platform in ASEAN, addressing an important gap in Maybank's footprint, said Maybank Chairman Tan Sri Megat Zaharuddin Megat Mohd Nor in a statement today.

"Kim Eng gives us the immediate platform to aggressively build up our global wholesale banking capabilities in Asean and beyond. "Immediately, Kim Eng, gives us an entry into Thailand," he said.

So it's throwing one stone and getting many birds at one go.

Smart move, Tiger Bank!