KATHMANDU: The Himalayan Reinsurance has finalized the purchase of the founding shares of Habib Bank in Himalayan Bank, marking a significant shift in ownership dynamics.
Previously, a British investment commission had expressed interest in acquiring the shares of the Pakistani-based Habib Bank.
Despite unsuccessful attempts, Himalayan Reinsurance emerged as the ultimate buyer, securing a crucial stake in the bank.
The Board of Directors at Himalayan Bank officially endorsed the sale of Habib’s shares to Himalayan Reinsurance, further solidifying the transaction.
The merger of Himalayan Bank with Civil Bank led to a reduction in Habib’s ownership from 20 percent to approximately 11.5 percent, valued at around 81 rupees per share.
Himalayan Reinsurance is set to acquire this diminished stake.
Habib’s decision to divest from Himalayan Bank signifies the end of a three-decade-long partnership.
Currently, Himalayan Relay, gearing up for an IPO at a premium, plans to purchase the shares at Rs 130 per share.
A formal request seeking approval for this acquisition has been submitted to the National Bank.
The Nepal Rastra Bank, in adherence to its rigorous ‘fit and proper test,’ evaluates the eligibility of investor companies vying for ownership of a bank’s founding shares.
Only qualified entities are granted permission to acquire shares.
With Nepal Rastra Bank intensifying the fit and proper test process, Himalayan Relay may receive the green light for the share purchase upon meeting the necessary criteria.
Himalayan Reinsurance, belonging to one of the nation’s largest business conglomerates, has recently adopted an aggressive investment expansion strategy to diversify its portfolio.
Led by Shekhar Golchha, former President of the Federation of Nepal Chamber of Commerce and Industry, the conglomerate also includes key figures such as Shahil Agarwal of Shankar Group and businessman Deepak Bhatta among its investors.
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