August 31, 2008
Malaysia's Maybank mulls abandoning BII deal – reports
Malaysia's Malayan Banking Bhd (Maybank) may pull out of a $2.7 billion acquisition of Bank Internasional Indonesia if Jakarta rejected its appeal to new takeover rules, Reuters reported Saturday quoting local media.
"We remain resolved that we want to pursue this transaction, but obviously, it would have to be without the new rules," Maybank Chief Executive Abdul Wahid Omar said in an interview with the Edge financial weekly.
"We can't proceed if the conditions are not conducive," he said.
The top Malaysian lender has agreed to buy a 55 percent stake in BII from Singapore's Temasek Holdings and South Korea's Kookmin in March.
But at the end of June Indonesia introduced new takeover rules that would require Maybank to ensure BII has a public float of 20 percent within two years. This prompted Bank Negara, Malaysia's central bank, to revoke its approval for the deal saying the new rules could lead to material losses for Maybank.
Maybank has appealed to Indonesia's markets regulator Bapepam against the ruling, but Bapepam said on Friday it would not make any exceptions for Maybank.
Maybank CEO said in the interview new rules should not apply to a deal struck earlier.
"I don't think it's fair for anyone to blame it on Maybank or Bank Negara...the core issue is the new rule (was) introduced and applied on a transaction that was launched in March," Abdul Wahid said.
In a separate interview with the Star newspaper he said Maybank remained committed to Indonesia.
"We want to be in Indonesia. But if can't do it now, then it's just a matter of re-entering the market at another appropriate time."
Maybank would lose a deposit of 480 million ringgit ($141.5 million) if the issue could not be resolved by Sept. 26, the deadline set by the sellers.
But Abdul Wahid said the actual loss would be 290 million ringgit, after taking into consideration a foreign exchange gain of 193 million ringgit on the Singapore dollar.