UAE Exchange bids for finance company Dunia: sources

Investors speak in front of a screen displaying stock information at the Abu Dhabi Securities Exchange June 25, 2014. (Reuters)

UAE Exchange, a global remittance and foreign exchange business headquartered in Abu Dhabi, is among bidders for consumer finance company Dunia, sources familiar with the matter have said.

Dubai shopping mall developer Majid Al Futtaim was among other parties to have lodged initial bids for Dunia, which had been due to be submitted two weeks ago, while there could also be interest from local banks, according to one of the sources, a United Arab Emirates-based banker.

Bloomberg reported last month that private equity group KKR was considering a bid, but a source familiar with the matter said that no bid had been lodged.

KKR has been seeking investments in the Middle East and is close to securing its first in the region, a deal to buy a stake in retailer Azadea, sources told Reuters in June.

Shareholders of Dunia are said to be targeting three times book value, which would give the company a price of more than 2.5 bln dirhams ($680 mln), said the UAE-based banker.

Dunia and the three existing shareholders declined to comment, as did KKR and Morgan Stanley, which is advising Dunia. UAE Exchange and Majid Al Futtaim both said they do not comment on market speculation.

UAE Exchange, owned through a 60/40 percent split between Abu Dhabi-based investment company Centurion Investments and Indian billionaire Bavaguthu Raghuram Shetty, has been rapidly expanding in recent times.

A consortium led by Shetty and Centurion agreed in May 2014 to buy global foreign exchange operator Travelex for about 800 mln pounds ($1.25 bln), with Shetty telling Reuters in January it would merge Travelex with UAE Exchange.

UAE Exchange's bid for Dunia was described as "aggressive" by one Abu Dhabi-based source, with the same source indicating the business would be folded into UAE Exchange, if it was ultimately successful.

Dunia Finance reported net profit of 119.6 mln dirhams in the first six months of this year, compared with 72.7 mln in the year earlier period. The company had total assets of 1.97 bln dirhams, financial statements show.

Last Update: Wednesday, 20 May 2020 KSA 14:12 - GMT 11:12