RHB Capital Bhd has received the green light fromBank Negara to start talking with CIMB Group Holdings Bhdand Malayan Banking Bhd on merger negotiations, paving the way for the bidders to submit their respective offers tomorrow.
RHB Cap had submitted its application to the central bank last Friday and told Bursa Malaysia yesterday that it received a letter of approval to commence negotiations with both banking groups for three months from the date of the letter.
StarBiz sources had disclosed over the weekend that RHB Cap's board of directors set an internal target of Thursday for Maybank and CIMB to submit their offers.
“The target is for the board to make a decision within two weeks from now and call for a shareholders meeting as they don't want the uncertainty to be prolonged - be if for the staff or the stock market,” a source had said.
Reliable sources also said CIMB had appointed Morgan Stanley as its adviser while it was reported previously that Maybank has gone withNomura Singapore Ltd.
Meanwhile, a Bloomberg report yesterday said Japan's biggest banking group Mitsubishi USJ Financial Group Incplanned to strengthen its capital alliance with CIMB group to boost its banking business in South-East Asia as it sells 29.9% stake in Kim Eng Holdings Ltd for 34 billion yen to CIMB's bigger rival Maybank.
Mitsubishi UFJ, which owns 4.1% of CIMB, wants to increase equity and bond underwriting in the region with its partner's corporate client network, the Japanese's brokerage unit said in a statement yesterday. The Japanese banking group's stake sale in Kim Eng is part of Maybank's takeover of Singaporean stockbroker Kim Eng.
Mitsubishi UFJ is seeking to utilise its stake in CIMB group to maintain a presence in Asean, as its smaller rival Sumitomo Mitsui Financial Groupwas rumoured to be eyeing Abu Dhabi Commercial Bank's (ADCB) 25% stake in RHB Cap.
ADCB's was seeking to sell its stake in RHB Cap as part of its rationalisation programme and also in line with Abu Dhabi's plan to rationalise its banking assets under a single umbrella.
A Maybank-RHB Cap merger would result in an enlarged banking group with assets of RM513bil (based on data as at end-March 2011) and market value of RM86.4bil. It will retain its spot as fourth largest bank by asset size in Asia but narrow the gap with its biggest rivals - Singapore'sDBS Bank, OCBC Bank and United Overseas Bank Group.
A CIMB-RHB Cap merger will lead to an enlarged group with assets of RM405bil, de-throning Maybank as the country's lead banking group based on assets at RM380bil.
The enlarged group will emerge as the fourth largest bank by asset size in the region.
Analysts who had pegged the deal at 2x-2.5x book of RHB Cap based on its net tangible asset per share of RM4.79 as at end March 2011, valued the group at RM9.58 to RM12.
RHB Cap had submitted its application to the central bank last Friday and told Bursa Malaysia yesterday that it received a letter of approval to commence negotiations with both banking groups for three months from the date of the letter.
StarBiz sources had disclosed over the weekend that RHB Cap's board of directors set an internal target of Thursday for Maybank and CIMB to submit their offers.
“The target is for the board to make a decision within two weeks from now and call for a shareholders meeting as they don't want the uncertainty to be prolonged - be if for the staff or the stock market,” a source had said.
Reliable sources also said CIMB had appointed Morgan Stanley as its adviser while it was reported previously that Maybank has gone withNomura Singapore Ltd.
Meanwhile, a Bloomberg report yesterday said Japan's biggest banking group Mitsubishi USJ Financial Group Incplanned to strengthen its capital alliance with CIMB group to boost its banking business in South-East Asia as it sells 29.9% stake in Kim Eng Holdings Ltd for 34 billion yen to CIMB's bigger rival Maybank.
Mitsubishi UFJ, which owns 4.1% of CIMB, wants to increase equity and bond underwriting in the region with its partner's corporate client network, the Japanese's brokerage unit said in a statement yesterday. The Japanese banking group's stake sale in Kim Eng is part of Maybank's takeover of Singaporean stockbroker Kim Eng.
Mitsubishi UFJ is seeking to utilise its stake in CIMB group to maintain a presence in Asean, as its smaller rival Sumitomo Mitsui Financial Groupwas rumoured to be eyeing Abu Dhabi Commercial Bank's (ADCB) 25% stake in RHB Cap.
ADCB's was seeking to sell its stake in RHB Cap as part of its rationalisation programme and also in line with Abu Dhabi's plan to rationalise its banking assets under a single umbrella.
A CIMB-RHB Cap merger will lead to an enlarged group with assets of RM405bil, de-throning Maybank as the country's lead banking group based on assets at RM380bil.
The enlarged group will emerge as the fourth largest bank by asset size in the region.
Analysts who had pegged the deal at 2x-2.5x book of RHB Cap based on its net tangible asset per share of RM4.79 as at end March 2011, valued the group at RM9.58 to RM12.
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