(MENAFN- Muscat Daily) Muscat- The Capital Market Authority (CMA) has requested the banks which are involved in merger negotiations to make their final decision on proposed mergers within a six-month period after the initial disclosure.
BankDhofar and National Bank of Oman (NBO) recently announced their plan to begin talks on a possible merger between the two lenders. Earlier in May, Oman Arab Bank (OAB) and Alizz Islamic Bank also agreed to explore the possibility for a strategic collaboration that may lead to an eventual merger of the two entities.
In respective letters written to the banks, the CMA has requested BankDhofar and NBO as well as OAB and Alizz Islamic Bank to complete the negotiation process and make final decision on their proposed mergers within a period not exceeding six months from the announcement of first disclosure.
'In all the merger cases we need to ensure that there is a limited time period [given to the parties] to make a final decision on the transaction, so that by the end of that period investors get a clear picture whether the merger is going to happen or being called off,' H E Abdullah bin Salim al Salmi, executive president of the CMA toldMuscat Daily
.
He said, 'We have considered the time period needed in legal requirements and due diligence process in making a decision on merger transaction. We believe six months is enough time to make a decision whether the merger is going to happen or not.'
In October 2016, BankDhofar and Bank Sohar had decided to call off their proposed merger, after over three years of discussions, as the two banks had been unable to reach agreement on certain important key issues relating to the proposed merger.
'Transaction such as the merger between two banks is not an easy decision and nobody can predict whether it's going to happen or not. But we are now looking to ensure that investors get as much information as possible on proposed mergers, so that they can make their own decisions in a well-informed manner,' H E Salmi said.
Speaking about the proposed merger between BankDhofar and NBO, H E Salmi said, 'We hope to see something happeningwithin six months. We are a bit optimistic about the proposed merger between NBO and BankDhofar. There are synergies between the two banks and there is a will at both sides for this merger.'
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