MUSCAT: HSBC Oman, a subsidiary of HSBC Holdings, has reached a significant milestone in its merger with Sohar International. In an announcement via a regulatory filing yesterday and following previous disclosures, HSBC Oman revealed that a majority of shareholders have elected to receive cash consideration as part of the merger, marking a crucial development in the consolidation of the two banks.
The merger, which will be undertaken by way of incorporation, has garnered immense support from shareholders. The 172 shareholders, referred to as the ‘Cash Option Shareholders,’ collectively represent an impressive 96% of the total shareholding of HSBC Oman as of the record date of August 3, 2023. This overwhelming support reflects the shareholders' confidence in the merger and their desire to unlock immediate financial benefits.
As per the terms and conditions approved by the Extraordinary General Meetings of HSBC Oman and Sohar International, each Cash Option Shareholder will receive 73% of their consideration in cash. The cash consideration will be provided at a ratio of RO 0.177 per eligible HSBC Oman share. This means that for each eligible share held by a Cash Option Shareholder, they will receive cash amounting to RO 0.177.
In addition to the cash consideration, the remaining consideration for Cash Option Shareholders will be issued in the form of shares of Sohar International. This allocation will be calculated based on a ratio of 1.467 Sohar International shares for every remaining 1 HSBC Oman share. Any fractional shares resulting from the calculation will be rounded down to the nearest whole number of shares of Sohar International.
For HSBC Oman shareholders who did not elect or were not eligible to receive cash consideration, they will also receive shares of Sohar International. The allocation for these shareholders will be based on a ratio of 1.467 Sohar International shares for every 1 HSBC Oman share, rounded down to the nearest whole number of shares.
The merger of HSBC Oman with Sohar International represents a significant event in the banking sector of Oman. The incorporation method chosen for the merger ensures a seamless integration process, allowing for a smooth transition of operations and the consolidation of resources. This strategic move aims to create a more robust and competitive financial institution in the country.
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