Spanish lender CaixaBank has launched a full takeover bid for the remaining 55.9% share in Portugese bank BPI. The bid has been priced at €1.329 per share, giving the deal a value of over €1 billion.
The deal is subject approval from 50% of the shareholders, of which CaixaBank already holds a 44.1% share. CaixaBank intends to stick with the current management team employed at BPI.
Javier Flores, analyst at Asinver, believes CaixaBank has moved at the right time: “The bank has probably looked at it and seen a reasonable price. With slow growth domestically, there is a need for banks to look to international investment. If we bracket companies into two groups; the first being those who operate domestically and the second being those who also have an international portfolio, it is clear that the bigger Spanish banks need to be firmly in the second category,” he said.
Mr Flores believes that this latest move will increase pressure on domestic rivals BBVA and Santander: “I think what we may see is a type of Iberian battle between the banks. All of them will want to have a leg in Portugal. I would not be surprised to see Santander make a move for some part of Espirito Santo in the not too distant future,” he said.
The deal is likely to hit CaixaBank´s capital ratios by between 80-140 BPS, but Mr Flores notes: “CaixaBank are one of the most advanced banks with regards to meeting requirements for Basel 3. There is quite a lot of time before those requirements need to be met, but they are already well prepared. In any case, the bank will view this deal as a means to add value to their balance sheet,” he added.