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Malaysia’s top banks target RHB

  • Anita Davis
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Weeks after Carlyle and TPG reportedly teamed to bid for a 25% stake in Malaysian lender RHB Capital, top Malay banks Maybank and CIMB are each looking to make an acquisition bid for the asset, potentially creating the largest banking institution in Southeast Asia by value. According to the Malaysian Star, RHB and domestic regulators have given the two banking groups the go-ahead to engage in negotiations with RHB, which CIMB’s CEO said has not yet begun.

RHB, which may be worth up to MYR20 billion ($6.65 billion), is Malaysia's fifth-largest banking institution. If combined with Maybank or CIMB, the resulting entity would supplant Singapore's DBS as the region's largest lender.

Aside this takeover process, the Abu Dhabi Commercial Bank (ADCB) is looking to divest is 25% stake in RHB, which is estimated to be worth $1.6 billion. Earlier this month, it was reported that Carlyle and TPG were looking to buy that stake and faced competition from Japanese financial group Sumitomo Mitsui Banking Corporation. Reuters had previously reported that a wider group of private equity players were also interested in RHB. CVC Capital Partners and peer lenders including DBS Group and the Australia and New Zealand Banking Group - which already owns a 24% stake in Malaysian lender AMMB - were touted as potential acquirers.

Goldman Sachs and Bank of America Merrill Lynch are arranging the auction of ADCB's stake.

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