Burgan Bank signs purchase agreement to acquire United Gulf Bank in Bahrain

18/01/2025

KUWAIT CITY, Jan 18: Burgan Bank K.P.S.C. announced the signing of a Share Purchase Agreement (SPA) to acquire a 100% stake in United Gulf Bank B.S.C (UGB), a wholesale bank licensed and headquartered in Bahrain, from United Gulf Holding Company B.S.C. (UGH) for USD 190 million. This transaction is in line with the Bank’s strategy to diversify its asset portfolio by focusing on stable and less fluctuating markets, particularly Kuwait and the wider GCC region.

The agreement follows Burgan Bank’s receipt of all required regulatory approvals in both Kuwait and in Bahrain. The two parties will commence the ownership transfer process, the last step in this transaction, with expectations to be completed within the first quarter of 2025.

UGB has a wholesale banking license in Bahrain with an ‘Islamic window’ and is supervised by the Central Bank of Bahrain (CBB). It also owns a 60% stake in Kamco Investment Company (Kamco Invest), an investment company licensed and regulated by the Capital Markets Authority - Kuwait (CMA) and the Central Bank of Kuwait (CBK).

Commenting on the acquisition, Mr. Tony Daher, Group CEO of Burgan Bank, said: “The acquisition marks a significant milestone for our Group and is aligned with the Bank’s strategic pillars of diversifying its assets, enhancing its competitiveness and building new income streams. This acquisition provides Burgan with an opportunity to tap into key high-growth sectors of Islamic financing and investments, while creating significant cross-selling and up-selling opportunities, in addition to various integrational synergies.”

Furthermore, the transaction will strengthen the Bank’s offerings to its clients, providing them with access to the Kamco Invest platform. Kamco Invest currently offers a comprehensive range of investment solutions covering asset management, investment banking and brokerage. It is considered one of the largest asset managers in the region with AUM of ~USD 16 billion and has notable presence in key capital markets, including the Kingdom of Saudi Arabia, the United Arab Emirates, and the United Kingdom.

“The acquisition will solidify the business relationship between Burgan Bank and Kamco Invest, enabling both entities to deliver a seamless and integrated suite of financial services, leveraging their combined expertise to enhance client experiences and meet their diverse and evolving financial needs effectively,” added Mr. Daher.

Mr. Daher explained that Burgan Bank continues to be driven by its vision to become the most modern and advanced bank in Kuwait in the ambitious steps it takes to achieve sustainable growth and expansion. The Bank’s confident strides are further supported and guided by its focus on strategic priorities – most notably the redistribution of assets – keeping pace with digital transformation, developing human capital, and achieving environmental, social, and governance (ESG) excellence. Together, these efforts aim to provide a distinctive banking experience for Burgan’s customers that lives up to their aspirations and meets their needs. This latest acquisition comes following the sale of the Bank of Baghdad and the partial sale of Burgan Bank Turkey in 2023, which is a testament to Burgan’s commitment to deliver on its strategic pillars.

Mr. Daher concluded by stating that, “The key priority for Burgan now is to deliver on its envisioned operating model for UGB, which would be focused on generating onshore client revenues and serving clients in Bahrain, as well as supporting the Bank’s existing clientele through enhanced product and services offerings.”