September 18, 2020 - 16:27 AMT
PanARMENIAN.Net - The Warsaw Stock Exchange (GPW) Management Board and the Central Bank of Armenia (CBA) on Friday, September 17 signed a term sheet concerning negotiations to purchase 65% majority interest in the Armenia Securities Exchange (AMX) by GPW.
The agreement is not binding. The final terms of the acquisition will depend among others on results of due diligence and necessary corporate approvals.
The term sheet signed by GPW and CBA defines the framework conditions of further negotiations aiming at a potential investment agreement. In the next step, GPW will carry out a due diligence, draft a five-year development plan for the Armenia Securities Exchange in partnership with CBA and AMX, and define the final terms of the investment agreement, which may be different from the framework conditions.
As a part of its analyses preceding the execution of the term sheet, GPW has defined a list of more than a dozen potential strategic projects geared at long-term development of the Armenia Securities Exchange. The key areas of development include the implementation of innovative solutions based on state-of-the-art technology, the organisation of trade in commodities, support for dual listing of GPW and AMX issuers, and the provision of a modern trading platform.
The core business of the AMX Group is to organise trade in financial instruments and to operate a clearing house and a settlement institution for transactions in financial instruments in Armenia. The company has its seat in the Armenian capital city Yerevan. The Central Bank of Armenia holds 85% of AMX. The remaining 15% are AMX’s treasury shares. Under the memorandum, CBA will raise its stake to 90% and GPW will subsequently buy 65% of AMX from CBA. After the deal, CBA will hold 25% of AMX and the remaining 10% will be acquired by a third party to be named by GPW.