PETALING JAYA: The Utama Banking Group Bhd (UBG) board is expected to meet today to deliberate on a letter reminding Bank Negara of its request to begin talks with Primus Pacific Partners on the sale of its stake in Rashid Hussain Bhd (RHB).
The meeting, called by supporters of the Primus bid, was to finalise the wording of the letter as UBG was still waiting for the central bank to respond on the bid, a source said.
“The board just wants a response but there are members against sending a reminder as UBG has already requested Bank Negara's approval to commence talks with Primus,'' the source said.
UBG has said it plans to start talks with Primus as soon as Bank Negara gives the go-ahead.
Since then, the company has signed a memorandum of understanding (MoU) with Kuwait Finance House (KFH) on the proposed disposal of its stake in RHB that would grant KFH some exclusivity.
The MoU, which was worded as a binding agreement to negotiate the stake sale to a consortium led by KFH, would see KFH undertake due diligence and subsequently enter into a sale and purchase agreement.
It also stated that UBG would not deal with Primus unless the latter received Bank Negara approval to begin negotiations on the RHB stake.
The source said the letter of reminder might just be the final move on Primus' part, coming after a high-powered meeting in Sarawak last Saturday, involving former Finance Minister Tun Daim Zainuddin, the Sarawak chief minister and other parties backing the Primus bid.
The source said the Government had indicated its support for the KFH deal but also noted that it would have no objection if the Primus deal met the Government's objectives of developing the banking sector.
Among the conditions for approval are that any deal has to be acceptable to the Employees Provident Fund (EPF), address the RHB debt issue, protect minority shareholders and be in the interest of the banking sector.
Bank Negara is said to be ascertaining the value Primus can bring to RHB and had requested additional information on Primus last Friday before making a decision.
The EPF, however, is said to have indicated it preferred to deal with KFH, a decision that carried a lot of weight at the central bank, the source said.
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