DBS Bank has scaled down its ambitions for acquiring Alliance Bank Malaysia Bhd. Initially seeking to purchase up to 49% of the company, DBS has now revised its proposal to acquire a 30% stake. This strategic adjustment comes after the bank faced a setback due to regulatory hurdles, as the Malaysian central bank required a waiver for the initial 49% acquisition request. The revised proposal is expected to be more favorable for approval, allowing DBS to engage with Alliance's major shareholder, Vertical Theme Sdn Bhd, a Malaysian holding company backed by Temasek Holdings Pte Ltd, a significant Singapore state investor. This move would grant DBS a presence in Malaysia, a market already served by Singaporean rivals Oversea-Chinese Banking Corp and United Overseas Bank Ltd. However, the revised proposal still faces scrutiny, with representatives from both DBS and Vertical Theme declining to comment, and the Malaysian central bank yet to respond to inquiries. The potential acquisition could significantly impact the market, as Alliance's shares have already seen a 6% decline in Kuala Lumpur this year, while the city's main benchmark has only dropped by less than 2%. Alliance's market capitalization stands at approximately RM7.7 billion.
