A statement attributed to GFH Financial Group, the Bahrain-based Sharia-compliant investment bank, saying that it has pulled out of talks with Shuaa Capital to acquire the Dubai-based investment bank, has been removed from the Bahrain Stock Exchange website.
The publication of the statement on Sunday morning had come as a surprise.
GFH, which is listed in Dubai and Bahrain, had made an announcement on March 14 confirming that it is in talks with several financial institutions for potential mergers and acquisitions, including Shuaa.
Shuaa Capital had also confirmed on March 16 that it had held discussions with GFH with a view to the Bahraini Islamic investment group acquiring a majority stake in its business.
The regulatory filing to the Bahrain stock exchange, initially published on Sunday morning, quoting Nabeel Mirza, senior director of compliance, stated: “GFH would like to inform its shareholders and the markets that it has withdrawn its discussions for a potential acquisition of Shuaa Capital.”
Shuaa Capital declined to comment on Sunday afternoon. Neither GFH or the Bahrain Stock Exchange could be reached.
The Abu Dhabi Financial Group (ADFG), an alternative investment company with US$5 billion in assets, is the largest shareholder in both Shuaa and GFH.
Shuaa Capital, which is in the midst of restructuring its business, said in April that it recorded its first profit in seven quarters thanks to a reduction in money set aside to cover bad debt at its SME financing unit as well as cost-cutting.
Abu Dhabi Financial Group said in February that its strategy to breathe life into the struggling Dubai investment bank would focus on growing assets under its management, leveraging its balance sheet and increasing its business in Saudi Arabia and Egypt.
The Dubai Banking Group in June last year agreed to sell its 48.36 per cent stake in Shuaa to ADFG. In March, Shuaa said it would acquire two financial services firms from one of ADFG’s units.
mkassem@thenational.ae
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