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Thursday, 3 September 2020

Unnamed NBFS firm enters race for Blom Bank Egypt

M&A WATCH- Competition for Blom Bank acquisition could heat up as third potential suitor enters the race: Another foreign financial institution is reportedly competing with Emirates NBD and Bahrain’s Arab Banking Corporation (Bank ABC) to acquire Blom Bank Egypt, the local press reports, citing unnamed sources. But there’s a hitch: The unnamed suitor is a non-bank financial services outfit and so will face challenges convincing the Central Bank of Egypt to allow it to start due diligence.

Time is also against it: Pressure from the Lebanese central bank means that Blom is looking to exit Egypt before the year, which compresses the timeline for all potential bidders.

HSBC tapped to advise Bank ABC: Bank ABC reportedly hired HSBC as its financial advisor on the transaction, sources told the press. The Bahraini bank expects the CBE to greenlight its request to begin due diligence on Blom by the end of the week, the sources said. Bank ABC tabled a request to start the due diligence process earlier this week.

Background: Blom confirmed last month it is looking to sell its Egypt assets as its home country suffers its worst economic crisis in decades. Dubai-based Emirates NBD was the first to show interest. NBD is said to be close to completing its due diligence on the transaction, which could value Blom’s Egypt arm at USD 250-300 mn.

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