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Caixabank gets 84.5 percent stake in Portugal's Banco BPI in takeover

02/08/2017 | 02:12pm EDT
CaixaBank CEO Gonzalo Gortazar speaks during a news conference in Lisbon

LISBON (Reuters) - Spain's Caixabank successfully completed the takeover of Portugal's second-largest listed lender, Banco BPI, paying 645 million euros ($690 million) to raise its stake to 84.5 percent from 45 percent, the two banks said on Wednesday.

"This acquisition has a lot of financial logic, we're talking about two institutions that complete each other perfectly," CEO of Caixabank, Gonzalo Cortazar, told a news conference, adding that the Portuguese market "has potential".

The takeover took nearly two years to complete and was designed to boost Caixabank revenues outside Spain, where it faces stiff competition for lending. The Barcelona-based lender was one of Spain's most acquisitive banks during the financial crisis, and has struggled to offset falling profitability at home by buying smaller savings banks.

It launched its first bid for BPI in 2015 at 1.329 euros per share, but opposition by some shareholders, notably Angolan investor Isabel dos Santos, forced it to withdraw that bid last year, only to make a lower final offer of 1.134 euros a share.

Dos Santos, the daughter of Angola's president, had a stake of about 20 percent in the Portuguese bank. It was not immediately clear whether she was fully bought out.

BPI CEO Fernando Ulrich will step down, but Caixabank proposed that he be elected chairman of the board at BPI, which will keep its decision-making centre in Portugal.

Caixabank has said it expects savings of up to 84 million euros a year from merger synergies, including up to 45 million euros from 900 layoffs as businesses are combined.

Caixabank ended 2016 with a fully-loaded capital ratio - a measure of a bank's strength under the strictest capital rules - of 12.4 percent and expected the ratio to fall by up to 80-140 basis points, depending on the take-up of the BPI bid.

Although not immune to problems affecting Portugal's notoriously fragile banking sector, BPI has long finished paying off its state loans, while its larger rivals Millennium bcp (>> B. COM. PORTUGUES) and state-owned CGD still owe money to the state.

BPI had a 33 percent rise in 2016 net profit as net interest income rose while impairments for bad loans fell sharply. Its fully-loaded capital ratio at the end of 2016 was 11.1 percent.

Before the completion of the takeover, BPI handed control of its lucrative Angolan unit BFA to Angolan telecoms firm Unitel to meet requirements by the European Central Bank on risky exposure to the Angolan economy.

Dos Santos also indirectly controls Unitel and the BFA deal was seen as a way of winning her approval for the takeover.

Shares in BPI closed 6.58 percent lower before the announcement, on expectations it would drop out of Lisbon's PSI20 leading stock index. Caixabank shares fell 1 percent.

($1 = 0.9356 euros)

(Writing by Andrei Khalip; Editing by Ruth Pitchford)

By Sergio Goncalves

Stocks treated in this article : B. COM. PORTUGUES, BANCO BPI, CaixaBank SA

© Reuters 2017
Stocks mentioned in the article
ChangeLast1st jan.
BANCO BPI 0.00%End-of-day quote.0.00%
BANCO COMERCIAL PORTUGUÊS, S.A. -1.10% 0.1436 Real-time Quote.16.56%
CAIXABANK, S.A. 0.00% 2.615 Delayed Quote.24.46%
PSI 20 INDEX -0.52% 5075.4 Real-time Quote.4.16%
STEP CO.,LTD. 0.32% 1586 End-of-day quote.-0.69%
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05/20BANCO COMERCIAL PORTUGUÊS S A  : Convening Notice of General Meeting of Holders ..
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05/17Portuguese lender Millennium bcp's first-quarter profit jumps 64%
05/17BANCO COMERCIAL PORTUGUÊS S A  : Millennium bcp Earnings release as at 31 March ..
05/17Portuguese lender Millennium bcp's first-quarter profit jumps 64%
05/17BANCO COMERCIAL PORTUGUÊS, S.A.  : 1st quarter results
More news
Sales 2021 2 297 M 2 740 M 2 740 M
Net income 2021 169 M 202 M 202 M
Net Debt 2021 - - -
P/E ratio 2021 12,2x
Yield 2021 -
Capitalization 2 170 M 2 584 M 2 589 M
Capi. / Sales 2021 0,94x
Capi. / Sales 2022 0,92x
Nbr of Employees 17 068
Free-Float 49,4%
Duration : Period :
Banco Comercial Português, S.A. Technical Analysis Chart | BCP | PTBCP0AM0015 | MarketScreener
Technical analysis trends BANCO COMERCIAL PORTUGUÊS, S.A.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 10
Last Close Price 0,14 €
Average target price 0,17 €
Spread / Average Target 19,1%
EPS Revisions
Managers and Directors
Miguel Maya Dias Pinheiro Third Vice Chairman & Chief Executive Officer
Nuno Manuel da Silva Amado Chairman
Pedro Manuel Francisco da Silva Dias Group Head-Compliance
Cidália Maria Mota Lopes Independent Non-Executive Director
José Manuel Alves Elias da Costa Independent Non-Executive Director