(Bloomberg) -- Dubai’s Shuaa Capital PSC started talks for a potential combination with an Abu Dhabi entity, joining a stream of mergers in the Gulf’s financial industry. The shares surged.
The investment banking firm formed a working group "to review the commercial potential along with any legal and structural aspects of the transaction" with Abu Dhabi Financial Group, according to a statement. There is no certainty that the talks will result in a deal, it said.
Consolidation among financial institutions in the Gulf has been picking up following lower oil prices. Some of the biggest banks in the United Arab Emirates, Saudi Arabia and Kuwait are in the process of combining their operations.
Abu Dhabi Financial Group, which together with its controlled entities manages more than $20 billion in assets, is the owner of Shine Investments Commercial Projects. Shine holds 48.4 percent of Shuaa, whose Chairman Jassim Alseddiqui is the chief executive officer of Abu Dhabi Financial Group.
Shuaa shares climbed as much as 15 percent in Dubai on Sunday after Al Arabiya reported on potential merger talks. The stock was poised to end at the highest level in almost a month.
Shuaa has a market of about $207 million and had assets of $575 million at the end of last year.
©2019 Bloomberg L.P.
RECOMMENDED FOR YOU
POPULAR