Stock in Egypt's National Société Générale Bank soared, hitting maximum intraday trading limits, after Qatar National Bank (QNB) announced it was in talks to take control of the lender.
QNB revealed on Thursday after markets closed that it was in negotiations to purchase a 77.2 per cent stake in the Egyptian lender, owned by France's Société Générale.
The French bank is seeking asset sales to reinforce its balance sheet against the effects of the euro-zone debt crisis.
National Société Générale Bank shares leapt 10 per cent to 34.77 Egyptian pounds each. The increase pushed the EGX30 index of Egyptian equities up by 1.6 per cent, the most in a month, to 5,418.56. QNB has been seeking to enter Egypt for some time to catch up with banks from the UAE and Kuwait already present, and is also said to be bidding for the Egyptian arm of BNP Paribas.
But QNB is less likely to offer the fire-sale prices it had sought in its unsuccessful bid to acquire DenizBank, the Turkish arm of Dexia, said David Mikhail, an analyst at Beltone Financial.
"Société Générale is not really as desperate for capital as Dexia," he said. "We're expecting a moderate premium, not a massive premium but it'll [be] up to management to decide … It'll be a strategic choice, not just financial."
In the UAE, hints of further stimulus by the US Federal Reserve prompted a brief rally that fell flat by market close.
The Dubai Financial Market General Index slid 0.1 per cent to 1,545.59, while the Abu Dhabi Securities Exchange General Index sank 0.1 per cent to 2,557.01.
Emaar Properties, Dubai Islamic Bank and Air Arabia were the biggest movers weighing on the Dubai market measure.
Elsewhere in the Arabian Gulf, choppy trading resulted in Bahrain and Qatar's markets falling, while Oman and Kuwait ended the day with gains. The Saudi Tadawul All-Share Index fell 0.61 per cent to 7,090.90.
