SABB to buy HSBC stake in SABB Takaful

The Saudi British Bank (SABB) inked on Thursday an agreement with HSBC Asia Holdings BV and other wholly-owned subsidiaries of HSBC Holdings plc to buy their combined 32.5 percent stake in SABB Takaful for SAR 10.66 per share, totaling SAR 117.8 million.

The deal is expected to be finalized in H2 2017, subject to regulatory and shareholders’ approvals, the bank said in a bourse statement on Sunday. 

When completed, the acquisition will be reflected on SABB’s FY17 financial statements. 

Following the acquisition, SABB would own a 65 percent stake in the insurer, the statement added.

SABB Takaful generated SAR 194 million in gross written contributions in 2016 from Family and General Takaful business and had total assets of SAR 860 million as at year-end 2016.

“Almost all of this business is acquired through an agency distribution arrangement with SABB and the transaction is expected to result in stronger strategic alignment between the two companies,” SABB said, adding that the insurer’s employees and customers will not be affected by the deal.

The other wholly-owned subsidiaries of HSBC are Canada Crescent Nominees (UK) Limited, Canada Square Nominees (UK) Limited and Canada Water Nominees (UK) Limited.