The minority Tamweel shareholders will be asked to exchange their existing Tamweel shares for fresh shares to be issued by DIB. Each Tamweel shareholder will be offered ten (10) DIB shares for every eighteen (18) Tamweel shares held by them. The fair value of each share for DIB and Tamweel underlying the intended swap is set at AED 2.25 and AED 1.25 respectively.
It is the intention of DIB, subject to obtaining necessary approvals of an extraordinary general assembly of DIB shareholders, to issue new shares by way of a capital increase of the bank’s issued share capital in accordance with the Commercial Companies Law. The new DIB shares will be issued and capitalised through the transfer of Tamweel shares subject to the acceptance value of the offer.
The contemplated tender offer values each eighteen (18) shares in Tamweel as being worth ten (10) shares in DIB. DIB has been advised by independent valuers, namely Price Waterhouse Coopers, that this is an appropriate share swap ratio. Price Waterhouse Coopers assessed the fair market value of both DIB and Tamweel as at 30 September 2012, and assessed their values at AED 2.25 and AED 1.25 respectively.
Upon approval of all regulators, including the Ministry of Economy, the Securities and Commodities Authority of the UAE, the UAE Central Bank and the Dubai Financial Market, the date of the offer will be communicated individually to all Tamweel shareholders giving them adequate time to respond to the offer. The bank is confident that this offer serves the best interest of shareholders in both entities. It gives every Tamweel shareholder the opportunity to become a shareholder in a more lucrative and sizeable entity with a relatively liquid market in its shares whilst remaining exposed to the same industry sector and the Tamweel business itself.
After the closing of the share swap offer, DIB intends to apply to Securities and Commodities Authority of the UAE for the delisting of Tamweel shares from the Dubai Financial Market.