TPG Capital not bidding for RHB Cap
Filed Under (Business News) by Webmaster on 18-05-2011
Tagged Under : RHBCap, TPG Capital
TPG Capital tends to invest in ‘unpolished gems’ which it can add value to, but RHBCap had already advanced beyond this category, says a source
Kuala Lumpur: US private equity firm TPG Capital has decided not to pursue a stake in Malaysia’s fifth largest banking group RHB Capital Bhd (RHBCap), sources say.
Reuters reported last month that TPG and rival Carlyle Group were planning to launch a joint bid forAbu Dhabi Commercial Bank’s (ADCB) 25 per cent stake in RHBCap.
“TPG considered it but decided not to pursue it,” a source familiar with the plan said.
The source explained that TPG tends to invest in “unpolished gems” which it can add value to, but RHBCap had already advanced beyond this category and was considered a well-run bank that TPG could contribute little to.
It is understood, however, that TPG remains interested in the Southeast Asian market.
As it stands, it has interests in eight financial institutions in Asia, of which three or four are banks.
ADCB has been looking to sell its stake in RHBCap and hired Goldman Sachs and Bank of America-Merrill Lynch to run an action on the stake sale.
It is understood that the first round bids are due today.
Japan’s Sumitomo Mitsui Banking Corp has been reported by the media to be among those interested in the stake.
Business Times understands that some of the top local banks have been approached to buy the stake with a view to merge with RHBCap.
But Malayan Banking Bhd and CIMB Group Holdings Bhd, for example, have in recent years been on a merger and acquisition (M&A) trail and are currently digesting their buys, so whether they would want to go for another M&A so soon remains to be seen.
RHBCap’s controlling shareholder, the Employees Provident Fund, has said it would prefer to have a banking group take over the ADCB stake.
The new shareholder could be local or foreign, a local daily reported earlier this month.
