Broadcaster agrees to acquire 25pc shares of Summit Bank

KARACHI: Salman Iqbal, CEO of local television network, has agreed to acquire some 25 percent stakes in Summit Bank Limited (SBL) as part of a consortium led by Nasser Abdulla Hussain Lootah.

Lootah, a Dubai-based businessman, in March released a tender offer to acquire at least 51 percent of stakes of Summit Bank in terms of a share subscription agreement dated October 4, 2021 through a combination of subscription of new shares and acquisition of existing shares from the shareholders.

In this regard, Summit Bank on Friday shared material information that Salman Iqbal is willing to acquire some 25 percent shares of Summit Bank as a part of acquisition by Lootah.

“Salman Iqbal has agreed, in principle, to subscribe to such a number of shares in SBL as part of Lootah consortium at a subscription price of Rs 2.51 per share,” a notice sent to PSX said. This will enable Salman Iqbal to become a maximum up to 25 percent shareholder in SBL, subject to regulatory approvals.

According to the notice, the aforesaid percentage will be computed after taking into account the shares that are to be subscribed/acquired by Lootah. As per the announcement, this transaction would require an agreement to be executed shortly.

Lootah has said that he is fully obligated to acquire the shares from the shareholders pursuant to public announcement of offer announced in March 2022.

In October last year, Lootah had shown intention to acquire majority shareholding of Summit Bank Limited. The offer was communicated to the Board of Directors, which was considered at the emergency board meeting held on October 4, 2021. The board approved the offer at a discount price of Rs 2.561 per share.

For the purpose of the proposed transaction, the acquirer and SBL have entered into a share subscription agreement. Pursuant to the share subscription agreement, Summit Bank limited shall issue, by way of without rights, offer 5,976,095,618 ordinary shares at a subscription price of Rs 2.51, which shall be offered to the acquirer and the minority shareholders of the bank.

In addition to the subscription of shares by the acquirer in terms of the share subscription agreement, the acquirer shall purchase shares from the bank’s shareholders pursuant to the offer. The bank management believed that the acquisition of Summit Bank is a major step towards the requisite capital injection in the bank.

As on December 31, 2022, some 193 branches including 43 full-fledged Islamic branches of Summit Bank were operational. The bank’s loss after tax for 2021 stood at Rs. 2.887 billion against Rs. 6.948 billion last year, indicating an improvement of 58 percent.

Copyright Business Recorder, 2022