London Forfaiting bows to £31m bid

THE long-running auction of London Forfaiting has come to a head today as the trade finance house agreed a £30.9m cash offer from a Maltese buyer, FIMBank.

Maltese-listed FIMBank is offering 29.5p a share for Forfaiting, a 119% premium to the price prevailing last September, when Forfaiting said it was putting itself up for sale.

FIMBank has irrevocable acceptances from Forfaiting directors and other shareholders representing 37% of the shares. Forfaiting has also agreed to pay it a £310,000 break fee if the offer fails.

FIMBank chairman Najeeb Al-Saleh said: 'The acquisition will bring an established name in trade finance to the FIMBank Group and will enable us to accelerate the growth of our forfaiting business.'

He said the aim was not only to start growing the Forfaiting business, but also to cut its costs.

Forfaiting, which helps exporters by purchasing their customers' bills of exchange and promissory notes, decided it would prosper better as part of a larger group. FIMBank was advised by WestLB, while Forfaiting's advisers were Kinmont and Intelli. The shares rose 1 3/4p to 29p.

Forfaiting floated at 160p 15 years ago but was badly hit by the Asian and Russian financial crises in 1997 and 1998.