There were several announcements from NBQ in September about an EGM on 25 September 2008 but no further information was supplied by NBQ or ADX. However, the NBQ 2008 3Q financial statements (26 October 2008) clarified that a convertible bond for Global Investment House (GLOBAL) had been approved.
NBQ 2008 Q3 financial accounts:
Note 13. Share Capital
... At the Extra Ordinary General Meeting of the Shareholders held on September 25, 2008, the Shareholders approved the issuance of fully convertible bond for AED 2,359,500,000/- to Global Investment House, Kuwait, to be converted into 330 million shares of AED 1/- each at a premium of AED 6.15 per share. On conversion, the paid up capital of the Bank will increase from AED 1.32 billion to AED 1.65 billion, the premium amounting to AED 2.029 billion will be transferred to statutory reserve.
ADX 01 September 2008:
(NBQ) National Bank of Umm Al Quwain announces its board of directors meeting results and the EGM will be held on September 25, 2008
ADX 24 September 2008:
(NBQ) National Bank of Umm Al Quwain EGM will be held on September 25, 2008
ADX 25 September 2008:
(NBQ) National Bank of Umm Al Quwain discloses results of its EGM
Some people have been hinting that Royalgroup might take a stake in Global, others mean that they are already in bed with each other and that Royalgroup are looking at Global to give them an investment vehicle.
Hello Bimcnorth and welcome to the where'd-I-park-my-convertible Abu Dhabi stock forum .
I don't think the bond has been converted yet - there was no conversion date obvious in the financial statements, so I presume Global still has the bond. _________________ UAE IPO list | posting guidelines
Hello rootnumber and welcome to the numbers-are-the-root-of-all-bonds stock forum .
I had another look at the 2008 Q3 financial statements for NBQ and there's nothing obvious in the Income Statement, Balance Sheet, or Cashflow Statement that indicates they've received a AED 2.36 billion cash injection from Global. Perhaps it will appear in the fourth quarter? I'm not very good with financial statements so don't assume what I say is correct. The original disclosure from the NBQ EGM has the amounts related to the convertible bond but no dates as far as I could see - disclosure wasn't in English so I'm not 100% sure. The only other bit of news I could find after the EGM results announcements was that there was some speculation that Global (GIH) might bail out of the deal, and that BNP Paribas (a French bank) and WestLB (a German bank) had arranged a $410m loan for Global to finance the purchase of the bond. But given the recent news of the GIH default risk, Global (GIH) might not have the cash for NBQ anymore anyway?
The ADX website says NBQ has 1.32 bn shares outstanding so obviously even if they had the cash, the bond has not yet been converted into shares (there will be 1.65 bn shares outstanding when it does).
Here's the original press release from NBQ about the convertible bond, but there's nothing that I can see to answer your question either.
Press Release 25 August 2008:
A Partnership Between National Bank of Umm Al Qaiwan and Global Investment House
Umm Al Qaiwan: The National Bank of Umm Al Qaiwain PSC (NBQ) and Global Investment House (GLOBAL) announced today a primary agreement to issue and subscribe a convertible debt instrument. The instrument will be issued by NBQ to Global for a total consideration of AED 2.36 billion. Global shall have the option to convert the instrument into 330 million new shares of NBQ. Upon successful conversion, the new issue would imply 25% expansion of the existing paid in share capital, giving Global 20% shareholding in NBQ. Finalizing the issuance is subject to UAE regulatory authorities' approval.
On this occasion, Sheikh Nasser bin Rashid Al Moalla, MD & CEO of NBQ stated, "We welcome Global as our new investor, and we believe that Global, being one of the most active investment companies in the region will add more value to the Bank in areas of asset management and corporate finance services". Upon conversion, it will raise NBQ's paid-up capital to AED1.65 billion and also will raise the shareholders' equity to over AED5.0 billion. The new capital will assist the Bank to develop its business operations and enhance its growth rate with a more solid capital basis, he further added.
Mr. Omar El-Quqa, Executive Vice President at Global said "This investment is in continuation of our interest to widen and strengthen Global's presence in the GCC banking and finance sector". "Our association with NBQ, should help us in several ways", added El-Quqa, "not only will it add to the distribution power of Global and also improve its flexibility for engineering capital adequacy for future expansions and principal investments."
Here's the Reuters report with some loan details. Odd that it was before the NBQ EGM to approve the convertible bond.
Reuters 06 September 2008:
Global seeks $410m to finance stake in NBQ
Kuwait's Global Investment House (GLOBAL) has launched syndication of a $410 million three-year term loan backing its acquisition of a 20 per cent stake in National Bank of Umm Al Quwain (NBQ). The company said in a press release financing will also be used for general corporate purposes. The loan was launched on Wednesday via arranging banks BNP Paribas and WestLB.
Meetings for potential lenders will take place in Dubai, Singapore, Taipei and London during the week beginning September 15. The loan pays a margin of 175 basis points (bps) over Libor. Lenders to the financing are invited to commit to the financing on four tickets of $30 million, $20 million, $10 million or $5 million, for fees of 120 bps, 100 bps, 85 bps or 75 bps respectively.
Global tapped the loan market in February this year for a $200 million 12-month loan via WestLB. That loan paid a margin of 60 bps over Libor stepping up to 90 bps after six months.
Founded in 1998, Global is listed on both the Kuwait and Bahrain Stock Exchanges and Dubai Financial Market. The company is rated BBB by both Fitch Ratings and Standard & Poors.
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