08 June 2012
K&N Kenanga Holdings Bhd and ECM Libra Financial Group Bhd have received Ministry of Finance's approval for their proposed merger
K&N Kenanga Holdings Bhd and ECM Libra Financial Group Bhd have received the Finance Minister's nod for their proposed merger.
Both investment banks told Bursa Malaysia in separate announcements that they had received the notification from Bank Negara.
The terms and conditions of the deal would be revealed when the definitive agreements were signed, they said.
StarBiz had reported in February that K&N Kenanga was close to an agreement to buy the investment banking and broking unit of ECM Libra for about RM900mil.
It has been reported that ECM Libra's major shareholders, including Tan Sri Azman Hashim with a 23.85% stake, have been looking to sell their shares at the right price.
Azman, who is also chairman of AMMB Holdings Bhd, emerged as ECM Libra's single-largest shareholder in 2007 after acquiring 128 million shares for RM102mil.
The acquisition increased his stake in the investment bank to about 22% then.
The sale will enable Azman to meet licensing rules that bar a single individual from being a key owner of more than one investment bank.
Concurrently, ECM Libra co-founders Lim Kian Onn and Datuk Seri Kalimullah Masheerul Hassan, who own 9.48% and 3.97% respectively, are also said to be open to selling their stakes.
Lim is currently ECM Libra's group director while Kalimullah is chairman.
ECM Libra, which has a market capitalisation of about RM669mil, is the country's 10th biggest broker by trading volume year-to-date, according to Bursa website.
K&N Kenanga is the seventh largest equities broker by trading volume so far this year.
ECM Libra finished 2.5 sen higher to 82 sen while Kenanga gained 0.5 sen to 62.5 sen.