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Greek bid wins bank in Turkey |
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Written by Agencies
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Tuesday, 04 April 2006 03:03 |
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National Bank, Greece's largest lender by assets, said Monday it will pay €2.3 billion for a 46 percent stake in Finansbank in Turkey, trumping a bid from Citigroup.
The deal, for the equivalent of $2.8 billion, is the largest overseas investment by a Greek company and one that some analysts thought might be hampered by politics. Greece and Turkey remain at odds over Cyprus and territory in the Aegean.
The Greek bank said it will offer to buy out minority shareholders in the second half of this year to raise its stake to at least 50.01 percent.
The Finansbank owner, Husnu Ozyegin, will keep a 10 percent stake in the mid-sized bank for at least two years and his company, Fiba Holding, will pay $580 million to buy Finansbank's Russian and Romanian branches from the lender.
Until late last week, Citigroup, which already has a presence in Turkey, was considered the favorite to buy a controlling stake in Finansbank.
Turkey, with a population of 72 million, represents the new frontier for international banks seeking growth. The start of European Union membership talks in October and falling interest rates in a more stable economy form the backdrop to an expansion in credit.
Turkey's economy has bounced back after a deep financial crisis in 2001 and its economy grew 7.6 percent last year. Last year, Fortis Bank bought Disbank and BNP Paribas purchased TEB. General Electric bought a $1.8 billion stake in Turkiye Garanti Bankasi in August, what was Turkey's biggest bank sale to date.
"Turkey is at the very early stages of growth, so there's huge potential," said Idil Dagdelen, an analyst at Bender Securities, an Istanbul-based unit of Deutsche Bank.
Finansbank's net income rose 68 percent last year to 470.2 million lira, or $349 million, after it increased loans by a third. The shares have more than tripled in the past year, partly on expectations of a sale.
National Bank's offer values Finansbank at $6 billion, compared with its current market value of $5.4 billion. Both banks' shares were suspended from trading Monday.
Shares in National Bank, the biggest company by value on the Athens exchange, with a market capitalization of €13 billion, have more than doubled since Takis Arapoglou took the helm in 2004.
Arapoglou, the chairman and chief executive, has cut the staff at the former state-controlled bank by about 10 percent, and sold or shut units in Western Europe, the United States and Canada to focus on Eastern European markets, betting that EU membership will spur loan demand there much as it did in Greece.
Analysts expect smaller Turkish banks to offer themselves for sale as the sector consolidates. Mid-size Denizbank is seen as the next foreign acquisition target, according to analysts. Its majority owner, Zorlu Holding, has hired J.P. Morgan to look for a deal for the bank. $@
ATHENS National Bank, Greece's largest lender by assets, said Monday it will pay €2.3 billion for a 46 percent stake in Finansbank in Turkey, trumping a bid from Citigroup.
The deal, for the equivalent of $2.8 billion, is the largest overseas investment by a Greek company and one that some analysts thought might be hampered by politics. Greece and Turkey remain at odds over Cyprus and territory in the Aegean.
The Greek bank said it will offer to buy out minority shareholders in the second half of this year to raise its stake to at least 50.01 percent.
The Finansbank owner, Husnu Ozyegin, will keep a 10 percent stake in the mid-sized bank for at least two years and his company, Fiba Holding, will pay $580 million to buy Finansbank's Russian and Romanian branches from the lender.
Until late last week, Citigroup, which already has a presence in Turkey, was considered the favorite to buy a controlling stake in Finansbank.
Turkey, with a population of 72 million, represents the new frontier for international banks seeking growth. The start of European Union membership talks in October and falling interest rates in a more stable economy form the backdrop to an expansion in credit.
Turkey's economy has bounced back after a deep financial crisis in 2001 and its economy grew 7.6 percent last year. Last year, Fortis Bank bought Disbank and BNP Paribas purchased TEB. General Electric bought a $1.8 billion stake in Turkiye Garanti Bankasi in August, what was Turkey's biggest bank sale to date.
"Turkey is at the very early stages of growth, so there's huge potential," said Idil Dagdelen, an analyst at Bender Securities, an Istanbul-based unit of Deutsche Bank.
Finansbank's net income rose 68 percent last year to 470.2 million lira, or $349 million, after it increased loans by a third. The shares have more than tripled in the past year, partly on expectations of a sale.
National Bank's offer values Finansbank at $6 billion, compared with its current market value of $5.4 billion. Both banks' shares were suspended from trading Monday.
Shares in National Bank, the biggest company by value on the Athens exchange, with a market capitalization of €13 billion, have more than doubled since Takis Arapoglou took the helm in 2004.
Arapoglou, the chairman and chief executive, has cut the staff at the former state-controlled bank by about 10 percent, and sold or shut units in Western Europe, the United States and Canada to focus on Eastern European markets, betting that EU membership will spur loan demand there much as it did in Greece.
Analysts expect smaller Turkish banks to offer themselves for sale as the sector consolidates. Mid-size Denizbank is seen as the next foreign acquisition target, according to analysts. Its majority owner, Zorlu Holding, has hired J.P. Morgan to look for a deal for the bank. |
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