Investment Dar Co., the controlling
shareholder in British luxury carmaker Aston Martin, agreed to
sell its stake in a loss-making Bahraini bank for $92 million as
the Kuwaiti company restructures debt.

Investment Dar accepted an offer from National Bank of
Bahrain and a state-run Social Insurance Organization Asset
Management Co. to sell its 51.6 percent stake, or 484 million
shares, in Bahrain Islamic Bank at 72 fils apiece, according to
statements posted on the Bahrain Bourse. National Bank of
Bahrain (NBB) and Social Insurance will hold 25.8 percent each after
obtaining regulatory approvals.

Investment Dar, which defaulted on a $100 million Islamic
bond in 2009, restructured about $5 billion of debt in 2011
after the global financial crisis crimped the ability of Kuwaiti
companies to meet financial obligations. The restructuring is
being implemented under Kuwait’s Financial Stability Law,
enacted by the government in April 2009 to bolster financial
institutions hurt by the credit crisis.

The Kuwaiti company was part of the group that bought Aston
Martin, the maker of luxury sports cars featured in James Bond
movies, for 503 million pounds in 2007. Aston Martin said in
December it will sell a 37.5 percent stake to Investindustrial,
giving the company the cash to invest in automotive resources to
compete with Volkswagen AG’s Bentley and Fiat SpA’s Ferrari.

Banking Merger

Investment Dar’s decision to sell its stake in Bahrain
Islamic Bank comes as lenders in the Persian Gulf country, the
home to the largest number of Islamic banks in the Middle East,
seek to merge and as the central bank encourages consolidation.
Bahrain Islamic Bank (BISB), with 833 million dinars ($2.2 billion) of
assets, has posted losses for the past four years, according to
data compiled by Bloomberg. The bank last year abandoned a
possible merger with Al-Salam Bank. (SALAM)

“We have been looking for an appropriate opportunity to
establish a footprint in the Islamic banking industry and
Bahrain Islamic Bank represents a suitable vehicle for us,”
National Bank of Bahrain’s Chief Executive Officer Abdul Razak
Hassan Al Qassim said in the statement. “Bahrain Islamic Bank’s
strengths in Islamic banking and its sound retail franchise will
complement our business.”

Elaf Bank BSC, Capital Management House BSC and Capivest
BSC combined to form a lender with assets exceeding $400 million
in the Middle East, North Africa, Europe and Asia, the deal’s
lead adviser said last month. Gulf Finance House, a Manama-based
investment bank, said in January it is studying “a number of
options” to merge Khaleeji Commercial Bank (KHCB) with other banks in
Bahrain.

Central bank governor Rasheed al-Maraj said at a conference
in Manama on March 5 that there are more merger talks between
banks in Bahrain. “The time for simple banks is gone,” he
said. “We are entering a period where there is no more room for
small banks.”

To contact the reporter on this story:
Shaji Mathew in Dubai at
shajimathew@bloomberg.net

To contact the editor responsible for this story:
Riad Hamade at
rhamade@bloomberg.net