Pakistan’s Fatima Fertilizers Limited has expressed interest in acquiring a majority stake in Samba Bank Limited’s Pakistan Operations. In a notice to Pakistan Stock Exchange, Company announced that the Board of Directors of the Company gave the Company preliminary permission to evaluate and implement (including within the framework of a consortium of parties) the proposed acquisition of a controlling stake in Samba Bank Pakistan Operations (approximately 84.51 percent shareholding), for sale by the Saudi National Bank.
The fertilizer giant will begin preliminary Due Diligence with permission from the State Bank of Pakistan. At the same time, the Company hires advisers and consultants, implements the necessary information and regulates steps / actions, obtains regulatory approvals and negotiates.
Saudi National Bank is the direct parent of Samba Bank Limited and its management had decided earlier in the year to sell its shares in Samba Bank Limited in Pakistan.
Fatima Fertilizer Company Limited is listed on the Pakistan Stock Exchange (PSX. The Company was formed by a joint venture between two major business groups in Pakistan namely, Fatima Group and Arif Habib Group. The Company is primarily involved in manufacturing and selling variants of fertilizers and chemicals. The production facilities are all located in Punjab, Pakistan. The Company mainly produces Urea, CAN, and NP.
Samba Bank Limited is a banking company listed on Pakistan Stock Exchange. In 2007, Samba Financial Group (SFG) of the Kingdom of Saudi Arabia acquired a 68.4% stake in Crescent Commercial Bank Limited (CCBL), CCBL was re-branded as Samba Bank Limited in 2008.
Samba Bank is classified as a small sized bank with a market share of 0.42% (CY20) in deposits. Total Assets of the Bank stood at PKR 203 billion at Sep-2021 end. Total Equity of the bank stood at PKR 15.5 billion
Being a small sized bank, SAMBA wasn’t considered for acquisition by existing commercial banks in Pakistan. It was evident that, any interest in acquisition, if arose, will be from Non-Banking Sector.
Fatima Fertilizer had Total Assets of PKR 158 billion with a strong Equity muscle of PKR 90.8 billion. The transaction if approved will be a mix of Debt and Equity, where purchase will primarily be from Debt (up to 70%).
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