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By Stanley Carvalho and Tom Arnold
ABU DHABI/DUBAI, Sept 27 (Reuters) - Qatar’s third-largest lender, Commercial Bank, is in talks to sell its 40 percent stake in Abu Dhabi-listed United Arab Bank to the UAE’s Tabarak Investment, sources told Reuters on Wednesday.
Commercial Bank joins several Qatari companies exiting the United Arab Emirates due to a widening Gulf rift. The UAE, Saudi Arabia, Egypt and Bahrain cut diplomatic and economic ties with Qatar in June, accusing it of supporting terrorism, a charge Doha denies.
Commercial Bank on Tuesday said it entered into a 90-day period of exclusivity with a “third party purchaser” it did not name to negotiate the terms of a deal, according to a statement on the Qatar bourse.
Privately-owned Tabarak is in early stage discussions with CBQ, sources familiar with the matter said, declining to be named as the matter is not yet public.
“They even have a price commitment pending that due diligence,” said one of the sources.
Tabarak declined to comment.
Commercial Bank’s stake in United Arab Bank is worth around $217 million, according to Thomson Reuters data.
Qatar’s Commercial Bank said in an email to Reuters that the bank received interest from a number of potential buyers for UAB’s shares and has accepted a conditional offer from one.
“Their identity is confidential as per the terms of our agreement,” CBQ said.
The move is the latest sign of Qatari companies weighing an exit from the UAE following the diplomatic rift.
Commercial Bank said however that the potential transaction was not a reaction to the diplomatic situation, but a strategic business decision that would allow the bank to redeploy capital more productively.
Other Qatari companies are looking to scale back from the UAE. Last week, Qatar Insurance said it would close its Abu Dhabi branch because it was unable to renew its business licence.
Doha Bank, Qatar’s fifth-biggest lender, has cut around 10 jobs in the UAE and is in talks to sell some of its UAE assets.
Last month, major shipping and logistics group Qatar Navigation said it was shifting its regional hub from Dubai to the Omani port of Sohar because direct shipments between Jebel Ali and Doha were no longer possible.
Companies in the UAE, Saudi Arabia and Bahrain have not so far announced formal exits from Qatar, but Qatari trade statistics suggest their exports to Doha have plunged since the crisis began.
United Arab Bank is listed in Abu Dhabi but headquartered in Sharjah.
Tabarak, which calls itself a private equity vehicle, has a stake in Dubai’s Drake & Scull International and is invested in sectors such as education, industry, logistics and healthcare. (Additonal reporting by Alexander Cornwell, editing by Adrian Croft)