Freshfields has advised Abu Dhabi-based First Gulf Bank PJSC on its proposed merger with National Bank of Abu Dhabi PJSC
Freshfields Bruckhaus Deringer LLP (‘Freshfields’) has advised Abu Dhabi-based First Gulf Bank PJSC (‘FGB’) on its proposed merger with National Bank of Abu Dhabi PJSC (‘NBAD’).
The proposed merger will create the largest bank in the Middle East and North Africa region (‘MENA’), with AED642 billion (US$175 billion)[1] of assets and a combined market capitalisation of approximately AED106.9 billion (US$29.1 billion)[2]. It will be the leading financial institution in the UAE and will operate an international network of branches and offices spanning 19 countries. Both entities will continue to operate independently until the merger becomes effective, which is expected in the first quarter of 2017.
The proposed transaction is a merger of equals and will be executed through a share swap, whereby FGB shareholders will receive 1.254 NBAD shares for each FGB share they hold. The bank will retain the name ‘National Bank of Abu Dhabi’.
The combined bank is set to become a significant engine of growth for the UAE due to its diversified offering and strong fundamentals. The proposed merger stands to accelerate the growth strategies of both FGB and NBAD and provide exceptional benefit to customers and investors across the globe.
The Freshfields team that advised FGB was led by corporate partners Pervez Akhtar and Michael Hilton and senior associates Mohammad Tbaishat, Charlotte Stevens and Ahmed Arif. Partner Stuart Grider provided securities advice and partner Michael Raffan advised in relation to international regulatory matters.
Commenting on the transaction, Pervez said, ‘This is the most significant financial institutions transaction to take place in the UAE and wider region for nearly a decade. FGB and NBAD are both leading banks in their own right with differing but very complementary products and services. Bringing them together creates a lot of synergies and benefits, and it makes a lot of commercial and strategic sense. The merger will further enhance Abu Dhabi's already strong position and relationships in the regional and international financial markets, but it will also create a larger, stronger platform to support further domestic investment and growth in Abu Dhabi as the Emirate continues its economic development. Freshfields has previously advised on a number of the most significant financial institutions transactions in the region, and we are very pleased to be advising on this merger, which is strategically important and will shape the market.’
The merger is subject to a number of conditions, including the approval of the merger by at least 75 percent by value of the shares represented at quorate general assembly meetings of FGB and NBAD. The merger is also subject to receipt of all required regulatory approvals.
[1] Based Q1 2016 financials
[2] As of 30 June 2016, based on closing price
