Books open for BKME

24 May 2002

The month-long subscription period for the sale of the government's stake in Bank of Kuwait & the Middle East (BKME)opened on 19 May. It is scheduled to close on 18 June.

A total of 300 million shares in the bank - or 42.5 per cent of the bank's outstanding shares - are being offered for sale. Superficially, the offering has been structured to suit retail investors with bidders for the shares invited to offer commitments for stock blocks with a minimum size of 1,000 shares and a maximum size of 250,000 shares. It is understood, however, that there are mechanisms by which institutional investors will be able to build block bids for much larger portions of the offering. Only Kuwaiti nationals are permitted to participate in the transaction.

The offering is priced at KD 0.311 ($1.00) a share, which was based on the 30-day average for the period prior to the government announcing the sale. Since then, BKME's stock has surged and as MEED went to press was trading at KD 0.360 ($1.16) a share.

The two institutions most likely to attempt to take sizeable positions in BKME are Burgan Bankand Bahrain-based partially Kuwaiti-owned Ahli United Bank (AUB). Before the government share sale was announced, AUB held a 22 per cent stake in BKME, and the bank has, in the past, made no secret of its overarching aim of holding a majority position in all its subsidiaries and affiliates (MEED 21:12:01; 30:3:01).

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