Reuters: Financial Services and Real Estate: Malaysia's RHB, OSK get gov't nod for merger

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Malaysia's RHB, OSK get gov't nod for merger Apr 30th 2012, 01:49 KUALA LUMPUR, April 30 | Sun Apr 29, 2012 9:49pm EDT KUALA LUMPUR, April 30 (Reuters) - Malaysia's RHB Capital Bhd and OSK Holdings Bhd h ave obtained the finance ministry's approval to merge RH B's banking group with OSK's investment bank, according to filings to the local bourse. "Further details on the possible merger will be announced upon the execution of a conditional share purchase agreement between OSK and RHB," both RHB and OSK said in separate filings to the local stock exchange on late Friday. The proposed deal with OSK will enable RHB, Malaysia's fifth-biggest banking group by assets, to capture the No. 1 slot from CIMB Group Holdings Bhd in the domestic stock broking business. Newspaper reports have pegged the deal value at up to 2.5 billion ringgit ($821.56 million). OSK and RHB have been in talks since late last year. The deal comes as Malaysian authorities have been encouraging bank mergers to create larger groups with the financial muscle to grab regional market share. The acquisition will give RHB access to OSK's significant operations in Singapore and other markets such as Hong Kong, Indonesia and Cambodia. RH B's market share in the stock broking business will increase to nearly 15 percent from about 10 percent. The deal will see OSK, a small financial group built up by veteran broker Ong Leong Huat, inject its investment banking, wealth management and stockbroking assets into RHB. ($1 = 3.0430 Malaysian ringgits) (Reporting by Yantoultra Ngui and Anshuman Daga; Editing Niluksi Koswanage) Link this Share this Digg this Email Reprints

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