Min­sheng takes on US funds in bid­ding for Por­tuguese bank

China Daily (Hong Kong) - - BUSINESS - By REUTERS

China’s Min­sheng Fi­nan­cial Hold­ing, US funds Apollo and Cen­ter­bridge — plus the pri­vate eq­uity firm Lone Star — are lead­ing at­tempts to buy Por­tu­gal’s Novo Banco, which was carved out of Banco Espir­ito Santo (BES) in 2014, four sources told Reuters.

Min­sheng has of­fered to buy a ma­jor­ity stake in Novo Banco, to be fol­lowed by an ini­tial pub­lic of­fer­ing of the re­main­der, while an Apol­loCen­ter­bridge com­bi­na­tion and Lone Star have also made bids for all of the bank, the sources said on Tues­day.

Por­tu­gal sal­vaged the “good bank” in a 4.9 bil­lion eu­ros ($5.22 bil­lion) rescue of BES, which col­lapsed un­der the weight of debts of its found­ing family, and has said it hopes to de­cide on Novo Banco’s sale by the end of 2016, ahead of an Au­gust 2017 dead­line.

An ear­lier at­tempt to sell Novo Banco last year was scrapped be­cause the bids were con­sid­ered too low by the govern­ment, but they have been in­creased this time round.

“The three bid­ders ... ahead in the race, are Min­sheng, Apollo/Cen­ter­bridge and Lone Star. These bid­ders have pre­sented the great­est com­mit­ment, in­ter­est and the most ro­bust pro­pos­als,” one of the sources told Reuters.

Chi­nese com­pa­nies have been ac­tively buy­ing as­sets, from in­fra­struc­ture to bank­ing, in Por­tu­gal since its 2010-13 debt cri­sis. The lat­est ac­qui­si­tion was by Fo­sun, which bought a 16.7 per­cent stake in Mil­len­nium bcp last month.

Apollo and Lone Star are also present in Por­tu­gal, the for­mer hold­ing two in­sur­ers

The three bid­ders ... ahead in the race, are Min­sheng, Apollo/ Cen­ter­bridge and Lone Star.” one of the sources share of Mil­len­nium bcp Fo­sun pur­chased last month

it bought in 2015 and 2016, and the lat­ter with four shop­ping malls ac­quired in 2015.

The source added that Por­tu­gal’s largest and sec­ond-largest listed banks, Mil­len­nium bcp and Banco BPI, are not out of the race, but have shown less in­ter­est. In Oc­to­ber, Trea­sury Sec­re­tary Ri­cardo Mour­inho Felix told Reuters there were five potential buyers.

An­other source said, how­ever, that the sale process will only be com­pleted once a win­ner is cho­sen and, un­til that mo­ment, the bid­ders can at any time im­prove their bids.

The ar­eas in which there could be im­prove­ments are the amount of state guar­an­tees de­manded for potential fu­ture li­a­bil­i­ties and the amount of cap­i­tal bid­ders are pre­pared to in­ject.

The ECB and Euro­pean Com­mis­sion also have to be con­sulted.

A spokesman at the Bank of Por­tu­gal would not comment on the sale process.

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