SABB affiliates sign agreement for sale, transfer of business lines worth SAR 766.5 mln

SABB branch

Saudi British Bank (SABB) announced that its two affiliates signed today, May 18, 2021, a business transfer agreement related to the sale and purchase of certain lines of business, according to a bourse statement.

The seller party is HSBC Saudi Arabia, in which SABB owns 49%, and the buyer is Alawwal Invest Co., in which SABB owns 100%.

The lines of business under sale and transfer are asset management, retail margin lending, and retail brokerage, at an estimated value of SAR 766.5 million.

The deal will be either fully or partially funded by SABB, by way of shareholder loan and/or equity injection into the buyer. The net book value of the to-be-transferred businesses amounts to SAR 646.7 million.

The deal will unlikely have an impact on the bank or its operations, according to the statement.

The transaction is aimed to allow the seller to become a smaller, less complex business that is simpler to manage, and the buyer to focus solely on asset management and servicing retail clients across margin lending and brokerage solutions, in line with Vision 2030.

The completion of the transaction is subject to obtaining regulatory and corporate approvals, in addition to the authorization of SABB’s general meeting.

HSBC Holdings plc - a substantial indirect shareholder of SABB, owning 31% - indirectly owns 51% of the seller.

David Dew, managing director and board member of SABB; Majed Najm, deputy MD Corporate & Institutional Banking at SABB; and Mohammad Alshayea, representative director of SABB in the seller’s board of directors, are all board members of HSBC Saudi Arabia.

Updates will be duly revealed, the statement added.