United Bank Limited (UBL), one of Pakistan’s largest commercial banks, has submitted an offer to Silkbank Limited for an amalgamation, aiming to merge Silkbank into UBL.

UBL shared the development with its stakeholders via a notice to the Pakistan Stock Exchange (PSX) on Friday.

“Further to our disclosure dated 28 April 2023, United Bank Limited (UBL) is pleased to inform that it has submitted an offer to Silkbank Limited for the amalgamation of Silkbank with and into UBL pursuant to a scheme of amalgamation to be filed with and sanctioned by the SBP under Section 48 of the Banking Companies Ordinance, 1962 (amalgamation),” read the notice.

Under the offer, UBL has proposed to issue one new UBL ordinary share for every 325 Silkbank ordinary shares as consideration for Silkbank’s shareholders.

UBL’s profit clocks in at massive Rs15.3bn in 2QCY24

“The offer and the amalgamation remain subject to approval of the Board of Directors (BoD) and shareholders of UBL, execution of definitive transaction documents between UBL and Silkbank, and receipt of all corporate, regulatory and third-party approvals and consents required for the amalgamation,” read the notice.

As per UBL’s latest financial results, the bank recorded a consolidated Profit After Tax (PAT) of Rs49.7 billion for the nine months ended September 30, 2024. The UBL board declared an interim cash dividend of Rs11 per share.

Last year in April, UBL informed its stakeholders that “it is exploring a potential merger with Silkbank Limited and intends to seek permission of the SBP to commence due diligence.”

“The potential merger will remain subject to due diligence, internal and regulatory approvals and definitive documents,” it said back then.

Following this, the BoD at Silkbank Limited gave its go-ahead to the management to formally pursue the ‘potential merger’ with UBL.