UAE company buys Uzbekistan’s Poytaxtbank for $10M

The State Assets Management Agency reported that the UAE company purchased Poytaxtbank for $10 million with a lump-sum payment.

Previously, an agreement had been signed to privatize the state share of the bank with Expobank LLC (Russian Federation). According to SAMA’s report, the current international relations situation meant that Expobank LLC could not fulfill the existing agreement terms, and therefore the contract was mutually annulled.

"Following this, the State Assets Management Agency and the international professional consultant Deloitte, involved in the privatization process, continued to accept offers from strategic investors.

During the process, the offer presented by Bond Investments Limited LLC was a commercial proposition that was higher than both the purchase value expressed by previous candidates and the value assessed by the independent evaluator KPMG.

This process was coordinated by the consultant Deloitte, and the draft purchase agreement was prepared. The consultant confirmed that neither Bond Investments Limited LLC nor any affiliated persons are on the open sanctions lists of the European Union, the USA, or major international financial institutions," the official report stated.

It was noted that the investor is one of the rapidly developing investment companies in the United Arab Emirates and operates within the Das Holding LLC group. The Holding group consists of diversified business sectors active throughout the Middle East and the world. They have experience in establishing and operating successful banks in the UAE, including Islamic and digital banking.

According to SAMA, the investor plans to create a banking infrastructure based on the most modern mobile and digital financial technologies on the premises of this bank.

For the complete legal conclusion of the deal, the investor is required to obtain preliminary authorization from the Central Bank of Uzbekistan for the purchase of Poytaxtbank JSC shares.

It should be noted that plans for the sale of Poytaxtbank to Russia's Expobank were first announced in 2021. During the economic forum in Tashkent that year, a memorandum was signed regarding the privatization of Poytaxtbank with the Russian bank.

A decree issued by the Cabinet of Ministers at the end of that year stated that the funds from the bank's sale were intended to be directed to the local budget of Tashkent city after deducting related costs.

The money received in the local budget was to be allocated by the Ministry of Finance for repaying budget loans provided to the local budget of Tashkent city, as well as for repaying loans granted by the Reconstruction and Development Fund and commercial banks.

The bank was founded in accordance with a resolution by the President of Uzbekistan in 2017. Its main activities include commercial banking operations, securities, foreign currency transactions, credits, and guarantees.

The bank was established under the 100% founding authority of the Tashkent City administration, with the local budget allocating 100 billion UZS for the formation of its charter capital.