Supplementary Disclosure : Kuwait Finance House K.S.C.P. Offer Document - Offer Documents relating to the acquisition by Kuwait Finance House K.S.C.P. of Ahli United Bank B.S.C.

Kuwait Finance House K.S.C.P.

(Incorporated in the State of Kuwait)

Commercial Registration Number 26066

OFFER DOCUMENT

Kuwait Finance House K.S.C.P. voluntary conditional offer to acquire up to 100% of the issued ordinary shares of Ahli United Bank B.S.C. by way of a share swap at an exchange ratio of 0.371 New KFH Share for each 1 AUB Share or 2.695 AUB Shares for 1 New KFH Share

Important: If you are in doubt about any aspect of this Offer Document and/or the Offer, you should consult a licensed securities dealer or licensed institution in securities, a bank manager, solicitor or attorney, professional accountant, or other professional advisor.

DISCLAIMER STATEMENT

The Central Bank of Bahrain, Bahrain Bourse and the Ministry of Industry and Commerce in the Kingdom of Bahrain, assume no responsibility for the accuracy and completeness of the statements and information contained in this Offer Document and expressly disclaim any liability whatsoever for any loss howsoever arising from the reliance upon the whole or any part of the contents to this Offer Document.

This Offer Document is dated 25 July 2022

Offeror

Kuwait Finance House K.S.C.P.

Financial Advisor to the Offeror	Legal Advisor to the Offeror	Bahrain Receiving Agent
Goldman Sachs International, Dubai	Freshfields Bruckhaus Deringer LLP	Bahrain Clear B.S.C.(c)

International Financial Centre (DIFC) Branch

Bahrain Receiving Agent, Bahrain Execution Advisor		Kuwait Receiving Agent and
	and Cross Listing Advisor		Allotment Agent
			SICO B.S.C.(c)		Kuwait Clearing Company K.S.C

DIRECTORS' DECLARATION

THE DIRECTORS OF KUWAIT FINANCE HOUSE K.S.C.P. ISSUING THIS OFFER DOCUMENT, WHOSE NAMES APPEAR BELOW, JOINTLY AND SEVERALLY ACCEPT FULL RESPONSIBILITY FOR THE ACCURACY OF INFORMATION CONTAINED IN THIS OFFER DOCUMENT. TO THE BEST OF THE KNOWLEDGE AND BELIEF OF THE DIRECTORS, WHO HAVE TAKEN ALL REASONABLE CARE TO ENSURE THAT SUCH IS THE CASE, THE INFORMATION CONTAINED IN THIS OFFER DOCUMENT IS IN ACCORDANCE WITH THE FACTS AND CONTAINS NO OMISSIONS LIKELY TO AFFECT THE IMPORTANCE AND COMPLETENESS OF THIS OFFER DOCUMENT.

STATEMENT FROM THE BOARD OF DIRECTORS OF KUWAIT FINANCE HOUSE K.S.C.P.

This Offer Document has been prepared by Kuwait Finance House K.S.C.P. in accordance with the Central Bank of Bahrain (CBB) Rulebook, Volume 6, Takeovers, Mergers and Acquisitions Module, in particular Appendix TMA-C, to provide information to the shareholders of Ahli United Bank B.S.C. in connection with the offer made by Kuwait Finance House K.S.C.P. to acquire 100% of the issued ordinary shares of Ahli United Bank B.S.C.

This Offer Document has been filed with the CBB. The Board of Directors of Kuwait Finance House K.S.C.P. hereby declare that having taken all reasonable care to ensure that such is the case, the information contained in this Offer Document is, to the best of its knowledge, in accordance with the facts and contains no material omissions.

Board of Directors	Title	Signature
Hamad Abdul Mohsen Al Marzouq	Chairman
Abdul Aziz Yacoub Alnafisi	Vice Chairman
Fahad Ali AlGhanim	Director
Mohammed Naser Al-Fouzan	Director
Muad Saud Al Osaimi	Director
Khaled Salem Al Nisf	Director
Noorur Rahman Abid	Independent Director
Hanan Yousef Ali Yousef	Director
Motlaq Mubarak Al-Sanei	Director
Salah Abdulaziz Al-Muraikhi	Director
Ahmad Meshari Al-Faris	Independent Director
Hamad Abdellatif Al-Barjas	Director

Important Information

This Offer Document has been prepared in connection with a voluntary conditional offer (the Offer) made by Kuwait Finance House K.S.C.P. (the Offeror or KFH) to acquire up to 100% of the issued ordinary shares of Ahli United Bank B.S.C. (the Offeree or AUB), on the terms and conditions set out in this Offer Document. This Offer becomes unconditional only if the Conditions Precedent are fulfilled or waived, where applicable, as set out in section ‎5.7 (Conditions Precedent to the Offer) of this Offer Document.

If at the time you receive this Offer Document, and prior to providing your Acceptance, you have sold all your shares in AUB, you should immediately hand this Offer Document to the person to whom the shares have been sold, or to the person authorized by AUB or BB or another agent through whom the sale was made, to effect the sale or transfer in favor of the person to whom the shares have been sold. However, this Offer Document should not be forwarded to or distributed in any jurisdiction where such transfer would constitute a violation of the relevant laws in such jurisdiction. If you have sold only part or otherwise transferred only part of your shares in AUB, you should retain this Offer Document.

This Offer Document has been prepared in compliance with the provisions of the TMA Module of the CBB Rulebook, Volume 6.

This Offer Document has been filed with the CBB and it does not constitute a guarantee by the CBB that the facts stated in this Offer Document are accurate or complete.

This Offer to AUB Shareholders resident in or citizens of countries other than the Kingdom of Bahrain or the State of Kuwait may be affected by the laws of their respective country of residence or citizenship and shall not be deemed to be an Offer in any jurisdiction where the Offer would violate the laws of such jurisdiction. All AUB Shareholders wishing to accept this Offer must satisfy themselves as to the due observance of the laws in the jurisdictions relevant to them, including the receipt of any necessary governmental consent or the payment of any taxes due.

The information in this Offer Document regarding the Offeror has been provided by the Offeror. The Financial Advisor and the Legal Advisor make no representation or warranty, express or implied, as to the accuracy or completeness of such information, and nothing contained in this Offer Document is, or shall be relied upon as, a promise or representation by the Financial Advisor or the Legal Advisor.

The information in this Offer Document pertaining to AUB has been prepared in good faith based on publicly available information. Consequently, the Offeror, the Financial Advisor and the Legal Advisor do not accept any liability for the accuracy or completeness of the information in this Offer Document regarding AUB.

All inquiries relating to this Offer Document should be directed to any of the Receiving Agents. No person has been authorized to provide any information or make any representation on behalf of the Offeror other than as indicated in this Offer Document.

The information contained in this Offer Document is correct as of the date of this Offer Document. Any new material information will be published and announced promptly as a supplement to this Offer Document in accordance with the provisions of the TMA Module.

IMPORTANT: If you are in any doubt about the contents of this Offer Document and the aspects of the Offer, you should consult a licensed securities dealer or an institution licensed in securities, a bank manager, solicitor or attorney, professional accountant or any other professional advisor. The fact that this Offer has been filed with the CBB, does not mean that the CBB takes responsibility for the performance of the Offeror or the Offeree, nor the correctness of any statements or representations made by the Offeror.

KFH | OFFER DOCUMENT | 1

Copies of this Offer Document can be obtained from the offices of the Receiving Agents, BB and the Participating Branches. An electronic copy of this Offer Document can be located at the following website: www.bahrainbourse.com or www.sicobank.com. Copies of the Acceptance and Transfer Form can be (i) in Bahrain, obtained from the offices of the Bahrain Receiving Agent, BB and the Participating Branches as well as the following website: www.ipo.com.kw; (ii) in Kuwait, provided and completed electronically at www.ipo.com.kw. This Offer Document has been prepared in an Arabic version and an English version.

Please refer to section 6‎ (Procedures for Accepting the Offer) for further details.

FORWARD LOOKING STATEMENTS

This Offer Document contains words or phrases such as 'will', 'aim', 'expect', 'anticipate', 'forecast', 'estimate', 'intend', 'future', 'objective', 'project', 'should', and similar expressions or variations of such expressions which are "Forward-Looking Statements". Such Forward Looking Statements are based on assumptions and should not be construed as being indicative of the actual events which will occur or a guarantee of future performance.

NOTICE TO SHAREHOLDERS LOCATED IN THE UNITED STATES

This Offer is made for the securities of a foreign company pursuant to a takeover offer under Bahraini law. Accordingly, the Acquisition will be made in the US pursuant to Section 14(e) and Regulation 14E under the U.S. Securities Exchange Act of 1934 as a "Tier I" tender offer, and otherwise in accordance with the requirements of Bahraini law. The Offer is therefore subject to procedural and disclosure requirements of a foreign country that are different from those of the United States. Financial statements included in this Offer Document, if any, have been prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

It may be difficult for you to enforce your rights and any claim you may have arising under the United States federal securities laws, since KFH is located in a foreign country, and some or all of its officers and directors may be residents of a foreign country. You may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the U.S. securities laws. It may be difficult to compel a foreign company and its affiliates to subject themselves to a U.S. court's judgment.

KFH reserves the right to purchase AUB Shares outside the Offer in accordance with the TMA Module and applicable laws.

This Offer Document does not constitute an offer of securities for sale in the United States. The New KFH Shares have not been, and will not be, registered under the U.S. Securities Act of 1933 (the U.S. Securities Act) or with any securities regulatory authority of any state of the United States. The New KFH Shares may not be offered, sold, pledged or otherwise transferred in the United States, except to persons reasonably believed to be qualified institutional buyers (QIBs), as defined in, and in reliance on, the exemption from the registration requirements of the U.S. Securities Act provided in Rule 144A under the U.S. Securities Act (Rule 144A) or another exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act. Such shareholders will be required to make such acknowledgements and representations to, and agreements with, KFH as KFH may require to establish that they are entitled to receive New KFH Shares. A person who receives New KFH Shares pursuant to the Offer may not resell such securities in the U.S. without registration under the U.S. Securities Act or without an applicable exemption from registration or in a transaction not subject to registration (including a transaction that satisfies the applicable requirements of Regulation S under the U.S. Securities Act).

The receipt of New KFH Shares pursuant to the Acquisition by a US AUB Shareholder may be a taxable transaction for US federal income tax purposes and under applicable US state and local, as well as foreign and other tax laws. Each AUB Shareholder is urged to consult an independent professional adviser immediately regarding applicable tax consequences of the Acquisition.

2 | KFH | OFFER DOCUMENT

Table of Contents

1.	Glossary..................................................................	4		11.2.	AUB Current Employees and
2.	Letter from the KFH Board of Directors..............	8			Organizational Structure..............................	53
	11.3.	Conversion of AUB'S Business to be
3.	Expected Timetable of Principal Events............	10			Sharia'a Compliant.....................................	53
4.	Resolutions and Approvals	11		11.4.	Mandatory Tender Offer for the
		Shares of AUB Kuwait.................................	53
	4.1.	COVID-19 postponement...........................	11
		11.5.	Conversion of AUB Kuwait to a
	4.2.	Board of Directors.......................................	11
			Digital Bank................................................	54
	4.3.	KFH General Assembly of Shareholders......	11
		11.6.	Statutory Merger in Bahrain........................	54
	4.4.	CBB - Capital Market Supervision
			11.7.	KFH Dividends Policy Post-Offer.................	54
		Directorate..................................................	11
			11.8.	Strategic Plans for the Offeree Company	54
5.	The Offer...............................................................	12		11.9.	KFH Group Structure Following
	5.1.	Securities for which the Offer is Made.........	12			Successful Completion of the Offer.............	55
	5.2.	The Offeree.................................................	12		11.10.	Long Term Commercial Justification
	5.3.	The Offeror..................................................	12			for the Offer................................................	55
	5.4.	Consideration for the Offer..........................	12	12. Share Ownership in KFH and AUB	57
	5.5.	Shareholders Eligible for the Offer...............	13
	5.6.	Suspension of Trading................................	13	13.	The Offeror's Confirmatory Statements............	58
	5.7.	Conditions Precedent to the Offer...............	13	14. Market Price and Historical Stock Trading
	5.8.	Offer Acceptance Procedures.....................	14
		Summary	59
	5.9.	Acceptance Irrevocable..............................	14
		14.1.	Trading Price of the Offeree.........................	59
	5.10.	Compulsory Acquisitions (Squeeze-Out).....	15
		14.2.	Trading Price of the Offeror.........................	61
	5.11.	Issuance of the New KFH Shares................	16
	5.12.	Rights of the New KFH Shares....................	17	15.	Effect of the Acquisition......................................	63
	5.13.	Delisting of AUB..........................................	17		15.1.	Legal Consequences of the Acquisition.......	63
6.	Procedures for Accepting the Offer	18		15.2.	No Special Benefits to Executives,
		Managers and Directors..............................	63
	6.1.	Form Submission........................................	18
		15.3.	The Effect of the Offer on the Directors
	6.2.	The Receiving Agents and the
				of the Offeror...............................................	63
		Participating Branches................................	24
			15.4.	Impact on Offeree's Employees...................	63
	6.3.	General Information.....................................	25
	6.4.	Purchase of AUB Shares Outside		16.	Risk Factors.........................................................	64
		the Offer......................................................	25		16.1.	Risks Relating to the Offer and
	6.5.	Tax..............................................................	25			the acquisition.............................................	64
	6.6.	Prior Contacts.............................................	25		16.2.	Risks Relating to the KFH Shares................	65
7.	The Offeror	27		16.3.	Risks Relating to the KFH Group's
		Business.....................................................	65
	7.1.	Kuwait Finance House K.S.C.P...................	27
		16.4.	Risks Relating to the MENA Region,
	7.2.	Capital and Major Shareholders..................	27
			Kuwait and Bahrain.....................................	67
	7.3.	Board of Directors.......................................	27
		16.5.	Risks relating to the global economy...........	68
	7.4.	Fatwa and Sharia'a Supervisory Board.......	32
	7.5.	Management Team.....................................	34	17.	Additional Information.........................................	70
	7.6.	Corporate Structure....................................	38		17.1.	Arrangements.............................................	70
	7.7.	Related Party and Business Model..............	38		17.2.	Significant Accounting Policies....................	70
	7.8.	Registered Addresses and Contact			17.3.	Shareholding and Dealings in Offeree
		Information..................................................	38			Company....................................................	70
8.	Report of the Independent Auditor on the			17.4.	Material Litigation........................................	70
		17.5.	No Material Liability.....................................	70
	Summary Consolidated Financial Statements
			17.6.	Documents on Display................................	70
	of Kuwait Finance House K.S.C.P	39
9.	Overview of Kuwait's Banking Sector	48	18.	Key Parties...........................................................	71
10.	Cross Shareholdings by the Offeror and		19.	Annexures.............................................................	72
		19.1.	Audited Financial Statements for the
	its Directors in AUB	52
			year ended 31 December 2021..................	72
11.	KFH Post-Acquisition Strategy...........................	53

11.1. AUB - Commercial Registration,

Legal Status and Trade Name.....................

53

KFH | OFFER DOCUMENT | 3