Banking M&A Digest #30 (27.6.2019)

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My weekly notes on banking and financial services - 

by Aivars Jurcans

Done! And Done

Bank of Nova Scotia, Canada’s 3rd biggest lender, has agreed to sell its operations in Puerto Rico and the US Virgin Islands to Oriental Bank for USD 560 million in cash.

Source: Reuters

Abu Dhabi Financial Group, an Abu Dhabi based investment group, has agreed to takeover terms of Shuaa Capital, a Dubai-listed investment bank. The deal values the combined companies at USD 918 million. Rebranded as ADFG, the new entity will have USD 12.8 billion of assets under management.

Source: Reuters, Financial Times

Tikehau, a French asset manager, has raised EUR 715 million in fresh capital to fund plans for growth and expansion in new geographies and into new alternative assets. The amount raised is below the initial target of between EUR 800 million and EUR 875 million.

Source: Financial Times

Allianz, a German insurer, has sold its 60% stake in Allianz Popular, a JV, to Banco Santander, Spain’s largest lender, in a transaction valued at EUR 937 million. Allianz Popular was one of Allianz’s most important distribution channels for life insurance in Spain and accounted for about 30% of gross written premiums.

Source: Financial Times

The Slovenian government has sold Abanka, the country’s 3rd largest lender, to Nova KBM, the 2nd largest bank owned by Apollo Global Management (80%) and the European Bank for Reconstruction and Development (20%), for EUR 444 million. The deal is expected to close by the end of 2019.

Source: Reuters

Deals on the Table

Banca Monte dei Paschi di Siena, an Italian lender, is said to be close to selling a package of bad loans with a face value of more than EUR 1.1 billion to Cerberus Capital, Bank of America and Illimity Bank. It negotiates a sale of non-performing loans with a gross book value of about EUR 500 million to Cerberus, secured bad loans with gross book value of about EUR 130 million – to BofA, and more than EUR 500 million of unsecured corporate loans – to Illimity Bank. 

Source: Bloomberg

Bellevue Group of Switzerland is said to be considering selling Bank am Bellevue, its wealth management unit. It had client assets of about USD 1.85 billion as at the end of 2018.

Source: Reuters

Insurance Australia Group, Australia’s 2nd largest insurer by market value, is said to be in talks to sell all or part of its 26% stake in India’s SBI General Insurance Company. According to media, among those shortlisted 6 are private equity funds.

Source: Reuters

Blackstone is said to have agreed to sell Lendmark Financial Services, a US consumer finance company, to Lightyear Capital, another private equity firm. Established in 1996 and based  in Lawrenceville, Georgia, Lendmark provides a variety of consumer credit products to mostly subprime clients.

Source: Reuters

Thanks, But No Deal

UniCredit is said to have put a possible bid for Commerzbank on hold for now because of not wanting to engage in negotiations so soon after the collapse of Deutsche -Commerzbank merger talks. 

Source: Reuters

NBK Capital Partners, a subsidiary of National Bank of Kuwait, is said to have walked away from advanced talks to acquire a global credit fund previously managed by Abraaj Capital, the collapsed Dubai buyout firm. The global credit fund had raised over USD 250 million to invest in “private debt to medium-sized and growth-oriented companies”.

Source Reuters

Where the Money Goes

Cross River Bank, a community bank that services many fintechs, has acquired Seed, a small business banking company. The financial details of the transaction were not disclosed. The deal is expected to expand Cross River’s technology and its small business banking offering.

Source: Reuters

Matthias Wittenburg, a former HSH Nordbank management board member, has set up a company, Companylinks, to act as matchmaker for the medium-sized German businesses (“Miitellstand”). The firm says it has gathered 6,500 expressions of interest from potential buyers and would be targeting the would-be sellers of businesses valued at more than EUR 3 million.

Source: Bloomberg

Up-and-Comers

Monzo, a UK based digital bank, has raised GBP 113 million to support its growth in the US. This transaction has doubled Monzo’s valuation to just over GBP 2 billion since its previous fundraising round 8 months ago.

Source: Financial Times

Exciting Numbers

According to EY, the UK financial services companies have racked up a Brexit bill of close to GBP 4 billion. The study says that companies currently plan to  move about 7,000 jobs and GBP 1 trillion of assets to the continent because of Brexit.

Source: Financial Times

According to KfW, a German state development bank, around 227,000 owners of small and medium-sized companies in Germany would want to find a heir or a buyer by the end of 2020. 

Source: Bloomberg

A Thought Worth Noting

“[The Bank of England] approaches Libra with an open mind but not an open door.”

Mark Carney, governor, Bank of England

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Aivars Jurcans has more than 20 years of corporate finance and investment banking experience. His services are currently available through MURINUS ADVISERS.

Photo by Daria Shevtsova on Unsplash

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