CHINA Construction Bank Corp has approached Malaysia about buying a stake in EON Capital, a source with knowledge of the matter said yesterday.
China's No. 2 lender is awaiting Malaysia's Ministry of Finance's response to its request for approval to begin talks with major shareholders in the seventh-largest Malaysian bank by market capitalization.
"This is still at a very early stage. We've informed the Malaysian finance ministry," the Beijing-based source said.
"There are many other departments, including the Malaysian central bank. This might even need the approval of the prime minister. The specifics of the approval process aren't entirely clear," said the source, who asked not to be named because of the sensitivity of the deal.
EON Capital, with a market capitalization of about US$1.6 billion, is the subject of a legal battle involving its largest shareholder, Hong Kong-based private-equity fund Primus Pacific Partners, and other shareholders over a plan by Hong Leong Bank to acquire the smaller lender.
Primus filed a lawsuit to stop Hong Leong Bank, Malaysia's sixth-largest lender, from taking over EON Capital last year.
A Bank Negara official said the central bank doesn't comment on individual institutions.