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MarketScreener Homepage  >  Equities  >  Saudi Arabian Stock Exchange  >  Samba Financial Group    1090   SA0007879097

SAMBA FINANCIAL GROUP

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NCB-Samba to merge into Saudi banking heavyweight

10/11/2020 | 10:35am EST
FILE PHOTO: A Saudi man walks outside the Saudi NCB bank, after a coronavirus outbreak, in Riyadh

RIYADH/DUBAI (Reuters) - Saudi Arabia's biggest lender National Commercial Bank (NCB) has entered a binding merger agreement with smaller lender Samba Financial Group to create a combined entity with 837 billion riyals ($223 billion) in assets, NCB said on Sunday.

Low oil prices and weak economic growth are pushing bank consolidation across the Gulf.

Once completed, the NCB-Samba tie-up would create the Gulf region's third largest lender by assets, after Qatar National Bank (QNB) and UAE's First Abu Dhabi Bank.

NCB agreed to pay 28.45 riyals for each Samba share, valuing it at approximately 55.7 billion riyals ($14.85 billion), NCB said in a bourse filing. That corresponds to a 3.5% premium to Samba's closing share price on Oct. 8, the last business day before Sunday's announcement.

Saudi Arabia has encouraged consolidation in the banking sector as it seeks to create stronger entities able to support the role the private sector can play in its push to diversify its oil-dependent economy.

"The merged bank will become the largest bank in the Kingdom and a leading bank in the Middle East region with 171 billion riyals in market capitalisation," NCB said.

Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), is a major investor in both banks, with current stakes of 44.29% in NCB and 22.91% in Samba.

After the merger, PIF will hold a 37.2% stake in the new entity while other substantial shareholders of the merged bank will include the Saudi Public Pension Agency with a 7.4% stake and the General Organisation for Social Insurance (GOSI) with a 5.8% stake.

Upon completion of the merger, shareholders of Samba will receive 0.739 new NCB shares for every one share of Samba, NCB said.

Samba chairman, Ammar Alkhudairy, will be chairman of the merged entity while NCB's current chairman, Saeed al-Ghamdi, will be managing director and chief executive officer.

The new entity will own both investment arms of the current banks, NCB Capital and Samba Capital. The merger is not expected to result in involuntary redundancy of employees, NCB said without elaborating.

(Reporting by Hadeel Al Sayegh in Dubai and Marwa Rashad in Riyadh; editing by Emelia Sithole-Matarise)


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
LONDON BRENT OIL -2.91% 54.8 Delayed Quote.9.17%
SAMBA FINANCIAL GROUP 0.32% 31.45 End-of-day quote.2.95%
THE NATIONAL COMMERCIAL BANK -0.44% 44.75 End-of-day quote.3.23%
WTI -3.09% 52.11 Delayed Quote.11.60%
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Financials
Sales 2020 9 416 M 2 510 M 2 510 M
Net income 2020 4 403 M 1 174 M 1 174 M
Net Debt 2020 - - -
P/E ratio 2020 13,6x
Yield 2020 2,40%
Capitalization 62 900 M 16 765 M 16 768 M
Capi. / Sales 2020 6,68x
Capi. / Sales 2021 7,00x
Nbr of Employees -
Free-Float 58,4%
Chart SAMBA FINANCIAL GROUP
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Samba Financial Group Technical Analysis Chart | 1090 | SA0007879097 | MarketScreener
Technical analysis trends SAMBA FINANCIAL GROUP
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Income Statement Evolution
Consensus
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Mean consensus OUTPERFORM
Number of Analysts 10
Average target price 30,94 SAR
Last Close Price 31,45 SAR
Spread / Highest target 16,1%
Spread / Average Target -1,64%
Spread / Lowest Target -27,5%
EPS Revisions
Managers and Directors
NameTitle
Ranya Mahmoud Nashar Chief Executive Officer
Ammar bin Abdulwahed Faleh Al-Khudairy Chairman
Abdul Haleem Sheikh Chief Financial Officer
Ali Hussein Alireza Non-Executive Director
Fahad Ibrahim Al-Mufarraj Independent Director
Sector and Competitors