Oman’s Bank Sohar has reached an agreement with Bank Dhofar on the terms of a proposed merger that would create a bank with combined assets of almost US$16 billion.
Each Bank Dhofar share will be exchanged for 1.29 shares of Bank Sohar if the merger goes ahead, Bank Sohar said on Wednesday. Bank Sohar gained 3.4 per cent to 0.18 Omani riyals at 2:07pm in Muscat, while Bank Dhofar rose 0.4 per cent to 0.25 riyals.
The two banks have been exploring a possible merger since July 2013. A combination of the lenders would create Oman’s second-largest bank, behind Bank Muscat, which has assets of $32bn. Bank Sohar’s acting chief executive, Rashad Ali Al Musafir resigned this month citing personal reasons, according to a statement published on the stock exchange website.
Activity in Oman has been picking up amid the slump in oil prices. The government is issuing a dollar bond and state-owned Petroleum Development Oman is raising a $3.4bn loan backed by oil sales. The government is also looking to sell a privately-placed sukuk, two people with knowledge of the matter said last month.
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