Published: Thursday July 12, 2012 MYT 7:15:00 PM
RBS excludes Indian operations in sale to CIMB Group
KUALA LUMPUR: The Royal Bank of Scotland (RBS) has excluded its India operations from an earlier sale and purchase agreement for various Asia Pacific cash equities and associated investment banking businesses to the CIMB Group.
"This termination of the proposed sale of RBS' cash equities, equity capital markets and M&A corporate finance business in India is due to an unexpected legal issue arising in connection with the sale of the Indian businesses by RBS," said CIMB Group on Thursday.
Group chief executive of CIMB Group, Datuk Seri Nazir Razak said the group remained committed to having an Indian component to its Asia Pacific Investment banking platform.
"We see this as a temporary delay in our Indian build-up as we will now have to follow the same process as Korea, which was excluded from the RBS transaction from the outset, and proceed to establish our own operation by applying for a new licence or purchasing an entity with an existing licence," he said.
To recap, the main part of CIMB's acquisition from RBS, involving operations in China and Hong Kong as well as their London and New York-based staff, was completed on June 30.
The transfer of operations in Indonesia, Malaysia, Singapore and Thailand was completed on April 27, and the balance involving Australia and Taiwan is on schedule for completion in the fourth quarter of 2012.
The India businesses were a part of a larger deal, in which CIMB agreed to acquire most of the Asia Pacific cash equities and associated investment banking businesses of RBS in Australia, China, Hong Kong, India, Indonesia, Malaysia, Singapore, Taiwan and Thailand.
CIMB's agreement to acquire most of the Asia Pacific cash equities and associated investment banking businesses of RBS was announced on April 2 at an initial cost of 173.9mil pound sterling (RM849.4mil).
Without the Indian portion, the total acquisition cost will be reduced to around 160mil pound sterling (RM781mil).