Shareholders approve merger of Silk Bank with UBL, Park View opposes
Shareholders of Silkbank Limited
have approved the amalgamation of the bank with United Bank Limited (UBL),
contingent on receiving regulatory approvals from the State Bank of Pakistan
(SBP) and the Competition Commission of Pakistan (CCP).
The approval, following UBL's offer
on October 31, 2024, for the proposed merger, was confirmed at an Extraordinary
General Meeting (EGM) held on December 26, 2024. Resolutions were also passed
to confirm the minutes of Silkbank's 28th Annual General Meeting, held earlier
on December 6, 2024.
Read More UBL
formally proposes merger with Silkbank via share swap agreement
According to a filing with the
Pakistan Stock Exchange (PSX), the approved resolution grants authority to
Silkbank’s President & CEO Shahram Raza Bakhtiar, CFO Khurram Khan, and
Company Secretary Faiz Ul Hasan Hashmi to execute all necessary actions. These
include making modifications to the amalgamation scheme, submitting it for SBP
approval, and liaising with relevant legal and regulatory bodies.
As part of the merger proposal, UBL
offered to issue new ordinary shares to Silkbank shareholders at a ratio of one
new UBL share for every 325 Silkbank shares, with the offer made on November 1,
2024.
Silkbank's Board of Directors gave
preliminary approval for the merger on November 6, 2024, authorizing the bank's
CEO to consult with advisors and consultants to evaluate UBL's offer and
present their recommendations for further consideration.
The merger is expected to have
significant effects on both banks, with Silkbank's shareholders set to become
part of UBL’s expanded operations, pending the necessary regulatory clearances.
Read More UBL
eyeing on Silkbank merger
Silkbank’s 2022 financial statements, published in December 2024, showed a negative equity of Rs 13.9 billion at the end of 2022, which is well below the minimum capital requirement of Rs 10 billion.
Park View Enclave files lawsuit against
merger
Park View Enclave (Private) Limited
has filed a lawsuit in the Sindh High Court, Karachi, challenging the proposed
merger of Silkbank Limited with United Bank Limited (UBL). The merger is being
pursued under a scheme approved by the State Bank of Pakistan, in accordance
with Section 48 of the Banking Companies Ordinance, 1962.
UBL has been named as Defendant No.
17 in the lawsuit.
On December 18, 2024, the Sindh High
Court issued an order regarding the matter, bringing further attention to the
ongoing legal dispute.
The proposed amalgamation of
Silkbank and UBL has been under scrutiny, with the State Bank of Pakistan
overseeing the process. This lawsuit adds an additional layer of complexity to
the merger transaction.
Source: Profit Pakistan