Malaysian financial conglomerate Affin Holdings agrees to acquire four of Hwang-DBS' core businesses for $408.8 million.

Affin Holdings, the Malaysian financial services group, has agreed to fully acquire the investment banking, asset management and futures businesses of local investment firm Hwang-DBS for MYR1.363 billion ($408.8 million) in cash. 

The takeover involves 100 per cent of Hwang-DBS Investment Bank, 70 per cent of Hwang Investment Management, 49 per cent of Asian Islamic Investment Management Sendirian and 100 per cent of Futures Sendirian, according to a statement. Prior to the closing of the proposed acquisition, Hwang-DBS will complete a pre-closing reorganisation, where the respective stakes owned by Hwang-DBS in the target firms will become subsidiaries of Hwang IB and Affin will acquire 100 per cent of Hwang IB after the pre-closing reorganisation and 17 per ent in Hwang IM.

To fund the purchase, Affin secured bridge loans of MYR1.4 billion. For the long long-term funding plan, the firm will undertake a fund raising exercise including a rights issue of new shares to raise gross proceeds of up to around MYR1.25 billion. Further details of this effort will be announced at a later date and will be subject to shareholders' approval.

The acquisition is expected to be complete by the second quarter of 2014, with Credit Suisse as financial advisor to Affin. Affin Holdings' unaudited paid-up capital stood at MYR1.5 billion as at 30 September 2013, while the Group's shareholders' fund was at MYR6.5 billion.