Linda Hutchinson-Jafar, Business Writer
RBTT Financial Holdings is considering a second offer to acquire the bank and its holdings, but will remain in negotiations with its first suitor, bank sources said Tuesday in the wake of a stock market filing last week.
A highly placed source at RBTT said Group Chairman Peter J. July had initially indicated that the board would have made a conclusive decision on the initial offer before the July 30 annual general meeting of shareholders.
"So there is now an extension on that time to deliberate on the two offers," the source told Wednesday Business.
FirstCaribbean International Bank (FCIB), which is owned by Canada's CIBC, is said to have made the initial offer of a merger with RBTT, Trinidad and Tobago's largest banking group.
Stuck on pricing
Market sources suggest that the talks with FirstCaribbean and RBTT have been stuck on the pricing of the deal.
The identity of the second suitor has also not been revealed.
RBTT merely said it had "been invited to enter into other strategic discussions," and that deliberations with the unnamed party about "a possible combination/partnership" were ongoing.
July said in a statement that it was incumbent on RBTT to investigate and to properly consider any and all opportunities that could enhance shareholder value.
"In considering any such opportunities, RBTT continues to take into account the best interests of all its stakeholders, and wishes to emphasise that there is no certainty that any transaction will result from discussions," he added.
Last April, after months of media speculation, RBTT admitted that it had received a proposal from a third party with "respect to a possible combination/partnership."
RBTT shareholder and businessman George Aboud said RBTT executives must keep uppermost in their minds that the group's share price three years ago stood at TT$44 per share.
"For careful consideration, negotiators must not look at the market conditions in the short term, but look at the long-term benefits in making recommendations to shareholders," Aboud said.
Aboud has previously raised questions about whether an FCIB takeover was in the best interest of RBTT shareholders, and called on the Central Bank of Trinidad and Tobago and the Securities and Exchange Commission to formally intervene their on behalf.
In RBTT's financial statement in May, July said over the past year, there has been ongoing speculation about the future of the RBTT Group, fuelled by commentary in the media.
"At the time of writing this report, I wish to confirm that there is no change to the status of the matter as expressed in our latter statement," July said.
"We have not, at this time, made any decision as to whether or not we will recommend it to our shareholders. We assure you, that as soon as there is any material development in this regard, we will make an announcement."
The RBTT Group recorded pre-tax earnings of TT$1.2 billion at its yearend, an increase of 6 per cent over the prioryear's profit of $1.1 billion.
Profit attributable to shareholders increased by $38 million or 4 per cent to $948 million, with earnings per share moving from $2.64 as restated to $2.76, an increase of 5 per cent.
One stockbroker in Port of Spain commented that RBTT continues to be a very attractive and solid financial institution with diversified interests throughout the Caribbean.
" It is one of the best financial institutions, not only in Trinidad and Tobago, but Caribbean wide, and it's really no surprise that another company is making a bid to have some sort of merger or accommodation with RBTT," he said.
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