Banque Zitouna braces for change as major shareholder shake-up imminent

Banque Zitouna will see up to 90.04% of its capital changing hands in the next few weeks as two of its biggest shareholders, the Tunisian government and the IDB, plan to fully divest their shares. MARC ROUSSOT reports.

The IDB has taken the decision over the past month to offload 20.9% of its shares in Banque Zitouna, one of the three fully-fledged Islamic banks operating in Tunisia, following discussions that started in 2017. The sale process has been initiated and is expected to conclude in the coming weeks, most likely by the end of the first quarter, depending on regulators’ approval.

While the IDB could not disclose the value of the deal and the name of potential investors it has been discussing with, media outlets mentioned Groupe Triki, a Tunisian holding company involved in the food-processing industry, poultry farming, construction, furniture industry and the textile sector, as the most probable buyer.

“The key factor supporting the IDB’s decision to divest its shares from Banque Zitouna is the maturity and the success level of the bank — it gives the IDB the confidence that Banque Zitouna can continue flying,” explains Abdul-Hakim Elwaer, a spokesperson at the IDB who rejects reports asserting that a disagreement between the IDB and the Tunisian government triggered the Islamic multilateral financier’s decision to leave Banque Zitouna’s capital.

In 2016, Banque Zitouna reported a net profit amounting to TND12.63 million (US$5.26 million) in comparison with TND9.51 million (US$3.96 million) a year before.

“Whenever we decide to invest or divest, it is on the basis of our overall investment strategy, it cannot be based on whatever disagreement or misunderstanding with other shareholders because, we, as a multi-government institution, have other means to resolve such issues. We are a multi-government institution, we deal directly with the top government and the central bank so that we can resolve any agreements or disagreements without having to resort for share sales,” says Abdul-Hakim.

The IDB’s relation with Banque Zitouna, which started in 2012, will not come to an end once it offloads its shares as Banque Zitouna is a major technical partner of the IDB in implementing Islamic finance and transferring the know-how to other African banks that would like to adopt Islamic finance.

The other big move
The IDB is Banque Zitouna’s second biggest shareholder after the Tunisian government, which holds 69.14% of the bank’s capital through direct and indirect investment.

In mid-January, the Morocco-headquartered financial advisory, Finactu, was engaged by the state-owned Al Karama Holding, a holding company used by the government as a tool to hold assets seized after the 2011 uprising, to lead a group of three others: accounting group BDO, Auxilium Consulting and legal firm Adly Bellagha & Associates, to arrange the sale of Banque Zitouna and Zitouna Takaful.

The consortium will propose a sale strategy, conduct due diligence, develop a marketing strategy and solidify the process of transfer of control, which Finactu in a statement shared, will involve 58% or more of Banque Zitouna’s capital.

Banque Zitouna did not respond to requests for comments by IFN.

This article first appeared in IFN Volume 15 Issue 08 on the 21st of February 2018

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