Shipping and commodities bank Standard Chartered has been the subject of a potential takeover bid by the Middle East’s largest lender.
First Abu Dhabi Bank (FAB) confirmed that it had considered making an offer for the emerging markets focused bank, according to a regulatory filing.
“First Abu Dhabi Bank confirms that it had previously been at the very early stages of evaluating a possible offer for Standard Chartered,” the bank said.
While FAB said it was no longer evaluating a possible offer, the news sent shares in Standard Chartered higher as investors weighed the prospects of any deal.
London-listed Standard Chartered is a top 20 ship finance bank with a portfolio of loans worth $6bn, according to Greek finance research firm Petrofin.
Standard Chartered's client base includes some of the biggest names in shipping such as Saudi tanker giant Bahri, as well as major Singapore shipowners such as BW Group and Ocean Network Express (ONE).
The Gulf lender had been considering a full takeover of Standard Chartered, Bloomberg first reported, in an attempt to build an emerging markets lender with more than $1trn of assets.
Standard Chartered is one of 30 banks that has signed up for the Poseidon Principles, a global framework that aims to align carbon emissions in the shipping industry with the international targets set by the United Nations.
The move by FAB will likely increase speculation about other potential bids for Standard Chartered, which makes most of its money in Asia, analysts said.
The lender has been the subject of periodic takeover rumours in media reports over the last decade, with Barclays and JPMorgan among potential suitors named in such stories, although no deal has ever come to pass, reported Reuters.
Though Standard Chartered is headquartered in Britain and answers primarily to UK regulators, the bank’s fate could be decided in Singapore, reported Bloomberg.
Temasek Holdings has been the company’s largest shareholder for nearly two decades, giving the Singaporean wealth fund the biggest individual say in what happens to the bank.
The stake originates from the last serious attempt to end Standard Chartered’s independence in 1986, when the bank fought off a bid from Lloyds Bank with the help of Singaporean financier Khoo Teck Puat, whose estate sold the holding to Temasek in 2006.
FAB’s interest in Standard Chartered is the latest in a series of moves by Abu Dhabi to increase its footprint in the shipping and commodities space.
In September 2022 reports emerged that Abu Dhabi National Oil Co (Adnoc) was in the early stages of talks to buy all or part of the business of the huge Swiss trading house Gunvor Group.
A deal would create a shipping and chartering operation controlling hundreds of ships, with increased market clout.
Adnoc’s vessel operation Adnoc Shipping & Logistics (Adnoc L&S) operates 130 ships, with a further 10 on order, while Gunvor owns or operates more than 100 vessels through Singapore-based subsidiary Clearlake Shipping.
