ME Bank closing in on deal with Bank of Queensland
Bank of Queensland has gone into a trading halt as it closes in on a deal to fully acquire the industry superannuation fund-owned ME Bank, after months of speculation around whether the boutique lender was for sale.
The Age and The Sydney Morning Herald earlier revealed ME Bank's significant super fund shareholders were sent an email last week saying a deal with BoQ was on the table and close to being finalised. The bank's smaller fund shareholders have also been asked to sell their shares and forced to sign non-disclosure agreements. BoQ was placed on a restricted list within some super funds this week, in order to prevent insider trading.
BoQ went into a trading halt late on Thursday afternoon in order to launch a capital raise "to fund a potential acquisition". The push to sell ME Bank has been brewing for years, as the lender had never paid its shareholders a dividend and failed to achieve the scale needed to compete with its commercial rivals.
ME Bank has informed shareholders its close to finalising a takeover deal with Bank of Queensland. Credit:Luis Enrique Ascui
Sources said while deal talks were at an advanced stage there is no guarantee it will be completed. ANZ Banking Group has also been linked in media reports with a bid for the company. "It's not 100 per cent a done deal. These things take time of course," said one source briefed on the situation who could not speak publicly because the talks are confidential. "Banks are somewhat more complicated than normal proprietary limited companies. But it's pretty much, it's very close to a done deal."
Another source from a smaller fund, who could not be identified because they had signed a confidentiality agreement, said they had been asked to sell their shares to BoQ. "It wasn't our initiative," the source said. "It's the board that has made a decision about the future. It's pretty hard to be competitive with the big banks."
A third source who could not be named because they are not authorised to speak publicly, said there was disagreement between the bank's shareholders around whether to sell the asset, with smaller funds wanting to retain it and larger funds pushing to divest. "The split was between larger and smaller," the source said. "AusSuper has always been a bit determinative where they go and they're the ones giving the nudge."