Portugal’s market regulator has told Spain’s Caixabank to launch a mandatory takeover bid for the 55 per cent of Banco BPI it does not already own, after shareholders in the Portuguese bank lifted the main obstacle to a deal.
More than 88 per cent of BPI investors on Wednesday voted to remove a voting rights cap on Caixabank’s 45 per cent stake in its Portuguese rival, which had stopped the Spanish bank from launching a full takeover offer.
Caixabank, Spain’s biggest bank by domestic market share, is expected to fund the €880m transaction without resorting to a rights issue, according to a person briefed on its strategy. But if Caixabank’s bid is fully accepted, it would cut its core capital ratio to about 10.5 per cent — below its target of between 11 and 12 per cent.
For some months, the future of BPI — which has a market capitalisation of €1.6bn — has been clouded in uncertainty by a dispute between Caixabank and Isobel dos Santos, the billionaire daughter of Angola’s president, who owns 20 per cent of BPI.
Ms dos Santos abstained in Wednesday’s vote, allowing the voting cap to be lifted, and she is now expected to sell her stake to Caixabank. To proceed with the deal, the Spanish bank will have to adjust its offer price to the latest six-month average, but that is unlikely to increase the cost significantly.
Another key to unblocking the deal impasse was a proposal by BPI to sell 2 per cent of its Angolan operation, called BFA, to a company controlled by Ms dos Santos. That would cut BPI’s stake in BFA to less than 50 per cent and help the Portuguese bank comply with EU rules requiring it to reduce its exposure to Angola.
A takeover of BPI would represent the latest step forward for Portugal’s undercapitalised banking sector, following an agreement last month between the Lisbon government and the EU over a €5bn recapitalisation package for state-owned Caixa Geral de Depósitos, the country’s largest lender.
Portugal is still trying to sell Novo Banco — the “good bank” rescued from the wreckage of Banco Espírito Santo — after an earlier auction failed last year. Meanwhile, Millennium BCP, Portugal’s largest listed lender, is holding talks with Fosun about the possible acquisition of a 30 per cent stake by the Chinese group.