CIMB Group, RHB Capital and MBSB Cease Discussions on Proposed Merger
Kuala Lumpur: CIMB Group Holdings Berhad (“CIMB Group”), RHB Capital Berhad (“RHB Capital”) and Malaysia Building Society Berhad (“MBSB”) announced today that they have ceased discussions on a proposed merger and creation of a mega Islamic bank in light of current economic conditions.
“We had thoroughly deliberated the merger, and whilst we remain convinced that the combination of our 3 franchises follows sound strategic logic, we ultimately were not able to arrive at a value creating transaction for all stakeholders. The decision to cease discussions was arrived at after a detailed review of potential synergies that could be realistically delivered, especially in the current economic environment,” said Tengku Dato’ Zafrul Tengku Abdul Aziz, Acting Group Chief Executive, CIMB Group. “We would like to put on record our sincere appreciation to the Board of Directors and management of RHB Capital and MBSB for their full cooperation during our discussions,” he added.
“We undertook the discussions of the proposed merger on the premise that we would be able to arrive at a value enhancing proposal for our stakeholders and bring it to our respective shareholders. Protecting and creating stakeholder value is paramount to all parties and given the changes in environment we could not conclude a case to proceed further. Nonetheless, we would like to thank all the parties involved in the discussions for the time and effort spent. We wish CIMB and MBSB well in all their future endeavours,” said Kellee Kam, Group Managing Director, RHB Capital.
Dato’ Ahmad Zaini bin Othman, President and Chief Executive Officer of MBSB said, “The opportunity to be a part of a mega Islamic bank was an exciting one for us. Given that the discussions have ceased, we can now continue to focus on the strength of our franchise and achieving the goals that we have originally set for ourselves. We thank everyone involved for their hard work.”
CIMB Group and RHB Capital have withdrawn their application to Bank Negara Malaysia, and the exclusivity agreement entered into by the parties has been terminated with the cessation of talks.