KUALA LUMPUR (Feb 16): Affin Holdings Bhd plans to undertake a corporate reorganisation exercise that would see its wholly-owned subsidiary Affin Bank Bhd taking over its listing status on the Main Market of the local stock exchange.

Under the corporate exercise, which is undertaken to position AFFIN Bank to spearhead the banking group’s future growth, Affin’s shares will be exchanged with the shares of Affin Bank on a one-to-one basis, it told Bursa Malaysia in a filing today. 

The announcement confirmed a report in this week's The Edge Weekly edition (Feb 13-19, 2017), with regards to Affin's restructuring plan.

“There will be no change to the shareholding structure, where[by] an existing shareholder of Affin will be ‘migrated’ to Affin Bank with the above,” said Affin in the statement.

Affin, which is currently the holding company for its major operating entities, including banking, insurance and money broking, said proposed reorganisation, would simplify the group’s shareholding structure and de-layer the current corporate structure of the group.

The exercise will also see Affin transferring its wholly-owned subsidiaries Affin Hwang IB and Affin Moneybrokers Sdn Bhd, as well as its 51%-owned joint venture AXA Affin Life Insurance Bhd and 37.07%-owned associate AXA AFfin General Insurance Bhd, to Affin Bank.

“In view of the changing dynamics of the economy and industry, it is paramount that we put in place, the right strategies centred on efficiency, adaptability and productivity to thrive and differentiate ourselves. 

“The Proposed Reorganisation will enhance the AFFIN Group’s synergy and allow us to move forward for the next phase of our growth,” said Affin group chief executive officer Kamarul Ariffin.

Affin Hwang Investment Bank Berhad is Affin’s principal adviser in the proposed reorganisation.

In its bourse filing, Affin said the listing status would provide Affin Bank with better access to capital and options, to raise the necessary funding for its future growth. Affin itself would be wound up after the proposed reorganisation.

Affin plans to complete the exercise in the fourth quarter of this year. Its shares climbed three sen or 1.2% to RM2.52 today, valuing it at RM4.9 billion.