The Bank of Sharjah has won the Middle East “Mergers & Acquisitions Deal of the Year” award from The Banker Magazine for its successful acquisition of the operations of BNPI Lebanon through its subsidiary Emirates Lebanon Bank SAL.

The Banker Magazine, in collaboration with FT Business, selected one winner for each of 10 categories across the Middle East region from over 480 entries for the “Deals of the Year” titles.

The judges employed a wide range of criteria in selecting the winning deals, with an emphasis on the degree to which client objectives were met. Deal complexity, innovation, speed of execution and pricing performance were also taken into account.

Bank of Sharjah impressed the judges with its acquisition for several reasons, including the fact that it was operating in adverse market conditions, said a top official.

The deal was among the first significant transactions to go through in Lebanon following the July 2006 war; the unstable security situation and ensuing constitutional vacancy resulting in political deadlock, Varouj Nerguizian, chairman of Emirates Lebanon Bank SAL, executive director and general manager of Bank of Sharjah.

He said this deal crowned the upgrade in Lebanon’s banking ratings, in recognition of the ability of the country’s banking industry to weather the storm during the current worldwide financial situation.

Transparency, he said, was the key to the success of the transaction and the Bank of Sharjah board remains extremely positive when it comes to Lebanon’s financial outlook.

The acquisition was also perceived as a pioneering move, as never before had a UAE-based bank acquired a majority stake in a Lebanese bank.

It is expected that this will start a new trend, as more Gulf banks look at expanding in the dynamic Levant. Strategically, the deal has allowed Bank of Sharjah to create a platform in the Levant through Emirates Lebanon Bank SAL asserting itself as a key regional player.

Funding and timing were also critical components that saw Bank of Sharjah receive the award “Deal of the Year 2009.”

In anticipation of the transaction, the institution raised $200 million at a pricing of 35bps over Libor, through its oversubscribed debut syndicate loan.

The fact that the syndicate loan occurred immediately right before the sub-prime crisis showed that in retrospect, it was perfectly timed and executed, with a very favourable pricing compared to what it would have been 1 or 2 months going forward from that date.

The positive feedback throughout the acquisition underscored its success. The challenge for Bank of Sharjah was to ensure a smooth continuity between the operations of the bank, the satisfaction of its customers and the setting up of Emirates Lebanon Bank SAL.

To ensure a smooth transaction, all staff members of Emirates Lebanon Bank SAL were involved in the process through a sustained and transparent internal communication effort.

Feedback and support were highly positive from regulators, clients and the business community at large. This was aided by a massive communications campaign that established Emirates Lebanon Bank SAL as one of the leading banking institutions in Lebanon, within the short time-frame of 3 months.-TradeArabia News Service