Latham & Watkins Advises ADIB on its Successful Rights Issue

The transaction marks the first time that rights issued by a bank in the UAE have been traded on the Abu Dhabi Securities Exchange.

September 30, 2015

Latham & Watkins has advised Abu Dhabi Islamic Bank PJSC (“ADIB”), one of the leading Islamic banks in the Middle East, in connection with its successful rights issue. The transaction marks the first time that rights issued by a bank in the UAE have been traded on the Abu Dhabi Securities Exchange.

The rights issue, which was approved by ADIB’s shareholders in an extraordinary general meeting held on 28 June 2015, increased ADIB’s share capital by AED 168,000,000 to AED 3,168,000,000 and entitled ADIB’s existing shareholders to subscribe to 56 new shares for every 1,000 held at a price of 3 dirhams each. The proceeds of the rights issue will be used by ADIB to support the bank’s continued growth, strengthen its capital base and fund its banking operations, including extending financing to customers. The rights issue signified the first time that rights issued by a bank in the UAE were traded on the Abu Dhabi Securities Exchange, following SCA Board Decision No. 38 of 2013 which implemented the necessary legal and regulatory framework. ADIB also acted as the Receiving Bank on the transaction, while ADIB Corporate Finance and Investment Banking acted as the Financial Advisor and Lead Manager.

Corporate partner Nomaan Raja commented: “We were delighted to advise ADIB in connection with its successful rights issue, which we hope will enable ADIB to solidify its capital base and maintain its strong position in the UAE market. We expect that this landmark transaction will set a precedent for future capital raisings by financial institutions under the UAE’s recently-implemented legal and regulatory framework for the trading of rights.”

The Latham & Watkins team was led by corporate partner Nomaan Raja with corporate associates Lee Irvine, Basil Al-Jafari and Muhannad Al-Najjab.

 
 
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