Silkbank has agreed to sell majority of its stake to Fauji Foundation, an army-owned conglomerate that owns Askari Bank.
“Silkbank hereby notifies the Pakistan Stock Exchange that the Board of Directors of Silkbank Limited in its meeting held on January 28, 2021, has subject to the approval of the State Bank of Pakistan, given its in-principle approval to allow Fauji Foundation to conduct the required due diligence,” a statement issued by the Silkbank read.
The financial terms of the deal were not made public, but the bank management has asked Fauji Foundation to conduct due diligence and the State Bank of Pakistan has been approached for permission in this regard.
Silkbank, formerly Saudi-Pak Commercial Bank, is mainly owned by Arif Habib Corp. with 28 percent shareholding, former finance adviser Shaukat Tarin (12 percent), International Finance Corporation (8 percent), Nomura (4 percent) and Bank of Muscat (3 percent), the report said.
The bank is profitable with net profit recorded at Rs151 million for the nine-month period of the calendar year 2020.
Fauji Foundation, also known as Fauji Group, runs more than 18 industries, including Askari Bank.
According to the website of Fauji Foundation, it is a trust that provides welfare services to its beneficiaries [ex-servicemen] that include healthcare, subsidized education, stipends and vocational and technical training. “It operates on a complete self-sustaining basis and receives no grants or assistance from any government or non-governmental Organisations,” it read.
It is also one of the largest business conglomerates operating in fertilizer, cement, power generation, renewable energy, oil & gas exploration, marine terminal, food and banking sectors of the country, as per the website.