Consolidated assets of merged entity will be worth almost $180bn
FGB has been named as the acquirer of NBAD, despite NBAD being bigger in the size in terms of assets, according to a statement to Abu Dhabi Securities Exchange (ADX), where the shares of both lenders are traded.
The deal, which was previously described as the merger of equals, is being carried out as an acquisition by reverse acquisition of NBAD by FGB to abide by accounting policies.
The group has adopted the acquisition method of accounting under IFRS 3 Business Combinations, the statement said.
According to the balance sheet posted on the ADX website, the consolidated assets of the merged entity would be worth almost AED661bn ($180bn), which is higher than the AED642bn announced previously.
The consolidated net profit of the new entity is reported at AED5.3bn, which is the total of NBADs AED2.65bn and FGBs AED2.66 net profits, at the end of first half of this year.
In July, the boards of the two Abu Dhabi government-controlled banks voted to merge the two financial giants and recommend the deal to respective shareholders. The transaction is expected to create the largest lender by assets in the Middle East and North Africa (Mena) region.
The banks did not say when the shareholders of NBAD and FGB will meet to vote on the possible combination. The merger is subject to regulatory approvals and getting a nod from at least 75 per cent of shareholders from each bank.
Both entities will continue to operate independently until the merger becomes effective, which is expected in the first quarter of 2017.
NBAD, on 15 August, said that its group CEO Alex Thursby had stepped down after more than three years at the helm. Abhijit Choudhury, the chief risk officer of NBAD, has taken over as the acting CEO. Choudhury will continue in the role until NBADs planned merger with rival First Gulf Bank (FGB) is completed.
Khalifa Sultan al-Suwaidi, who is currently a member of NBADs board, is taking on the newly created role of managing director to support the bank in the integration planning process before the merger is finished.
Abdulhamid Saeed, the current managing director of FGB, was announced as the CEO designate of NBAD on 3 July and is due to take up this position on completion of the merger, according to the statement.
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