The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Banking

Malaysian M&A is anything but easy

A hostile bid in the Malaysian banking market is almost unheard of. But CIMB's pursuit of Southern Bank has provoked more than just headlines, and now almost every major banking group in the country is in play.

OF MALAYSIA’S TOP 10 banking groups, only one, the biggest, is out of the M&A frame. Four banks are involved in negotiations, and there is speculation of varying credibility about the remaining five. A smaller bank, Bank Islam, is being bid for by Dubai Financial, a subsidiary of Dubai Investment Group.

At the centre of the action is Southern Bank, Malaysia’s ninth-largest banking group, which for more than three months has been pursued by CIMB, part of the Bumiputra-Commerce Group, Malaysia’s second largest. The deal’s twists and turns have been front-page news, with interest stoked by the involvement of prominent figures that include the sultan of Malaysia’s Selangor state; Nazir Razak, CIMB’s CEO; and Chua Ma Yu, one of the country’s most prominent investors.

The deal highlights the highly concentrated ownership structure of several of Malaysia’s largest banks and the instability that can arise when there is dependence on a shareholder with a substantial stake who can change his mind.

In February, the Southern Bank-CIMB saga took another dramatic turn when Southern Bank called off merger talks with CIMB, which had yet to make a formal offer, “to seek near-term merger alternatives”, raising the possibility that what could turn out to be Malaysia’s largest-ever M&A transaction could also turn into a hostile takeover, an extremely rare outcome in Malaysia.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree