RBS sells Asia-Pacific businesses to CIMB
Royal Bank of Scotland has signed the final deal to sell most of its equity capital market business in the Asia-Pacific region to Malaysia's CIMB.
RBS said yesterday it had agreed to exit its regional cash equities, corporate broking, equity capital markets, and mergers and acquisitions businesses as part of its plan to restructure its wholesale banking operations.
CIMB would be the sole buyer of these assets, including cash equities businesses in Australia, mainland China, Hong Kong, India and Taiwan, as well as the two cash equities sales desks in the United States and Britain, it said.
The cash consideration for the deal, based on net asset values, was expected to be about GBP75 million (HK$934.2 million), RBS said.
Equity capital markets and mergers and acquisitions businesses, which RBS at one time was interested in expanding in the region, would also be sold as part of the deal to CIMB. These assets include those in Australia, mainland China, Hong Kong, India, Indonesia, Malaysia, Singapore, Taiwan and Thailand.
However, two joint-venture RBS companies - RBS Morgans in Australia and Hua Ying Securities in China - were not included in the asset sale to CIMB, RBS said.
In February, RBS entered the final round of negotiations with potential buyers including CIMB and China International Capital Corp over the sale of its equities market business and regional research services, the South China Morning Post reported at the time.
The long-awaited sale of the equity capital market assets did not come as a surprise to the finance industry, which was more interested in the price tag.
Some analysts saw RBS' sale of its Asia-Pacific equity capital market business to a regional player such as CIMB as yet another example of the rise of Asian financial institutions.
'This is an excellent opportunity to complete the build-up of our capabilities in Asia-Pacific markets, and to do it quicker and less expensively than if we grew organically,' said Nazir Razak, CIMB's chief executive.
After the planned sale of the equity capital market assets, RBS wants to focus more on the fast-growing market in yuan-denominated bonds, Manfred Schmoelz, the head of transaction services origination for RBS in Asia-Pacific, told the Post recently.
How much of RBS is owned by the British government, following bailouts in 2008 and 2009