(MENAFN - Arab Times) Kuwait's Burgan Bank announced Saturday that it had received the Central Bank of Kuwait's approval on a share purchase agreement with Eurobank EFG to acquire Turkey's Eurobank Tekfen. "We thank the Central Bank of Kuwait for its continuous support and we are looking forward to getting the final approvals from the Turkey's Banking Regulation and Supervision Agency (BRSA)," said Burgan Bank Board Chairman Majed Essa Al-Ajeel in a press statement. Al-Ajeel pointed out that the Burgan Bank Group has acquired an existing and leading banking platform that enjoys an extensive network of 60 branches across vibrant areas in Turkey.
He added that the bank would introduce a wide array of financial products to its new customers in Turkey.
Under the terms of the agreement, Burgan Bank has agreed to acquire the stake for a consideration value of TRY 641 million (KD 99 million/355 million) representing 0.98x based on Sept 30, 2011 shareholders' equity.
In addition, Burgan Bank has also agreed to acquire an additional portfolio of Turkish loans from Eurobank EFG amounting to 214 million euros (KD 78 million/279 million). The total consideration will be funded fully from Burgan's existing internal cash resources.
Eurobank Tekfen was established in 1989 by Tekfen Group as an investment and finance bank. EFG acquired a 70 percent stake in the Bank in 2007 to further its regional presence. As at 30 September 2011, Eurobank Tekfen had total assets of TRY 5.428 billion, net customer loans of TRY 2.19 billion, customer deposits of TRY 2.075 billion and shareholders' equity of TRY 660 million. The Bank has extensive geographic coverage within Turkey through its network of 60 branches.
Established in 1977, Burgan Bank is the youngest commercial Bank based in Kuwait, with a significant focus on the corporate and financial institutions sectors, as well as having a growing retail and private bank customer base.
Burgan Bank has four majority owned subsidiaries: Gulf Bank Algeria - AGB (Algeria), Bank of Baghdad - BOB (Iraq), Jordan Kuwait Bank - JKB (Jordan) and Tunis International Bank - TIB (Tunisia), (collectively known as the "Burgan Bank Group").
The Bank has continuously improved its performance over the years through an expanded revenue structure, diversified funding sources, and a strong capital base.