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European Islamic Investment Bank in talks with Rasmala over stake European Islamic Investment Bank will buy a 30 per cent stake in Dubai-based Rasmala Investment Bank unit
European Islamic Investment Bank confirmed it was talking to Rasmala Holdings Limited about an investment, after two sources told Reuters the group was in talks to buy a 30 per cent stake in its Dubai-based Rasmala Investment Bank unit. In a statement to the London Stock Exchange on Thursday, EIIB confirmed it was in talks with Rasmala Holdings Limited "in relation to an investment", adding it expected to be "in a position to update the market early in the New Year." The acquisition, which is set to be completed in early 2012, will be made through a fresh issue of shares by Rasmala which EIIB will buy, two sources with knowledge of the matter had told Reuters earlier. "EIIB is working out a certain formula with Rasmala for the capital increase," a source, who declined to be identified because the talks are private, said. "They've agreed on the main terms but fine tuning some details." Rasmala's Chief Executive Officer, Anwar Abu Sbaitan, declined to comment. Existing shareholders in Rasmala, which include Deutsche Bank, will be diluted by the capital increase, a separate source said. Rasmala, which has around $900 million in assets, has offices in the United Arab Emirates, Saudi Arabia, Oman and Egypt and operates in asset management, corporate finance and institutional brokerage. Rasmala's chairman, Ali al Shihabi, told Reuters in November that it was in talks with one party about investing in the bank as part of a capital boost. Earlier this year, a slump in market turnover forced Rasmala to close its UAE retail brokerage business and to focus on institutional brokerage and research, asset management and corporate finance. Turnover and trading volumes on the Dubai and Abu Dhabi exchanges have fallen, extending a trend that started with the global financial crisis in 2008. The Dubai Financial Market slumped to a seven-year low on Wednesday, while the Abu Dhabi Securities Exchange hit its lowest level since March 2009.
