After months of rumors and press reports concerning a potential sale of the share of EFG-Hermes in Credit Libanais – at the time either denied or characterized as premature – prospective buyers have finally confirmed that a serious bidding process is underway.
Cedrus Invest Bank, BIT Bank, and a consortium of investors led by the bank's chairman Joseph Torbey are seeking to acquire the 63.7 percent stake of the Egypt-based EFG-Hermes Holding in Credit Libanais, said Raed Khoury, Chairman of Cedrus Invest Bank. The bids range between $470 million and $500 million, which value the bank at $738-$785 million.
Credit Libanais, under a gag agreement with EFG Hermes, effective until the end of February, is prevented from discussing the deal.
"Many of the rumors in the press are fabricated, grossly exaggerated, or just not accurate," said a high source at the bank. But a deal is in the making said the source.
The bank's consolidated assets and customer deposits stood at $9.16 billion and $7.74 billion, respectively, as of the end of 2014. Its 2015 figures have not been announced yet.
The deal is in the negotiation stage, it could be concluded within two months, Khoury said. If Cedrus wins the deal it will increase its capital to pay for the acquisition, he said.
A number of institutional investors are seeking to acquire EFG Hermes' stake in Credit Libanais, said Fouad El Khazen, the honorary Chairman of BIT Bank, who did not want to go into detail. He confirmed that Torbey too is gathering a consortium of investors to buy the stake.
EFG-Hermes, the biggest publicly traded investment bank in the Arab world, acquired its stake in Credit Libanais in 2010 for $542 million.
The second largest shareholder in Credit Libanais is CIH Bahrain International Holding, which has a 23.5 percent stake. The remaining 12.7 percent is held by over 1,000 individual shareholders, including Credit Libanais' executives and employees, each with less than a five percent stake.
Credit Libanais, which plans to expand in the states of the West Africa economic zone, has a presence in Cyprus, Bahrain, Iraq, Canada, and Senegal. The bank operates a network of 73 branches and has many subsidiaries engaged in various activities that include conventional and Islamic banking, insurance, leasing, real estate, tourism and ticketing, debt collection services, information technology, and advertising.