FIMBank in historic takeover of
leading global forfaiters entire share capital valued at
By Matthew Vella
Yesterday morning at 0900hrs an announcement was made on both the Malta
Stock Exchange and the London Stock Exchange of an offer by FIMBank
to purchase the entire issued share capital of London Forfaiting company,
the leading global forfaiting company.
The historic move, hailed by FIMBank director Francis Vassallo
as a step forward for Maltese banking, is currently in the
process of seeking 90 per cent approval by LFCs shareholders to
purchase the GBP30.9 million share capital at a premium of 119 per cent
over a closing price of 13.5 pence per share on 27 September 2002. FIMBank
currently has 60 per cent approval from LFC shareholders .
But LFCs board of directors unanimous go-ahead for the takeover
has spelt a major move ahead for FIMBank, the Kuwaiti-owned boutique
trade finance bank based in Malta. The company had long been edging
into the speciality niche of forfaiting especially when FIMBank took
on Margrith Lütschg-Emmenger, who joined them from WestLB in London
as executive Vice-President. Vassallo said the acquisition of LFC will
enable the fulfilment of this direction and also embellish the companys
portfolio and stature.
Searing off all competitive bids, FIMBanks takeover of LFC will
signal a considerable growth in size and scope for the company, and
has not ruled out streamlining plans for London Forfaiting which is
currently operating under a heavy cost-base. Once the offer is accepted
and unconditional in all respects, FIMBank will seek a delisting of
LFC from the London Stock Exchange.
The offer will be financed by a combination of FIMBanks own resources
and a short-term bridging loan from Bank of America, which will then
be repaid from LFCs cash resources.
LFC is a world-renowned player in forfaiting, the purchase and sale
of trade-related receivables on a non-recourse basis. It will continue
to offer forfaiting services as the trading arm of FIMbank, which Francis
Vassallo said would be "benefiting from LFCs brand name,
network and experience in this specialised niche market. This is a giant
step forward for FIMBank, now becoming a stronger player in the global
market of trade finance services."
Following yesterdays announcement, FIMBank expects to post a detailed
offer document to shareholders of LFC as soon as possible. The bank
has noted that it has the right to lower the shareholders approval
threshold to just over 50 per cent from the current 90 per cent, with
the consent of the provider of the bridging finance.
FIMBank will also be inviting its shareholders to the Malta Stock Exchange
on Monday, 28 July 2003 for an information presentation and briefing
on the friendly takeover and keep shareholders informed of all developments
in connection with the offer.