Spain's Santander Wins Controlling Stake in Polish Bank
September 15th, 2010
Santander, the highly acquisitive Spanish bank, has continued its aggressive march into emerging markets after winning the auction for a controlling stake in one of Poland’s largest banks.
Santander fought off stiff competition from European rivals to purchase the 70 per cent stake of Bank Zachodni WBK that Allied Irish Banks has been forced to sell as a condition of the state aid it has received from the Irish government.
It agreed to pay 11.66bn zlotys (£2.46bn) for the stake, beating the price offered by rival bidders BNP Paribas, the French bank, and PKO, Poland’s largest bank, which had the support of the Polish government.
The deal is the third Santander has announced in a matter of weeks, as the bank looks to sweep up assets that have hit the market following the financial crisis.
Last month it acquired a portfolio of 318 retail branches that Royal Bank of Scotland was ordered to sell as a way of reducing its UK market share.
That followed an agreement to buy $4.3bn of car loans from HSBC, part of the wind-down of the UK bank’s troubled US consumer finance arm, while in July it built on its position in Germany, buying 173 branches from a retrenching SEB of Sweden for €555m (£460m).
Santander was particularly eager to buy the stake in Bank Zachodni to strengthen its presence in emerging markets.
Poland is a dominant force in the economy of eastern and central Europe and is seen by Santander executives as a potential new Brazil – the South American economy that has been a highly successful market for the Spanish bank since it bought ABN Amro’s operation there.
“The transaction fulfils perfectly Santander’s strategic criteria for acquisitions and enhances our geographic diversification,” said Emilio Botín, Santander’s executive chairman.
Santander said it would make an offer to 100 per cent of Bank Zachodni’s shareholders, in which AIB will tender its shares. It may sell a minority stake to Apax Partners, the private equity group, at a later date. Santander will in addition buy AIB’s stake in Bank Zachodni’s asset management arm for €150m.
The bank has also expressed an interest in the other assets being sold by AIB – a minority stake in M&T, a regional US bank based in Buffalo, and a small portfolio of branches in the UK.
Santander recently resumed merger talks with M&T, which had fallen through earlier in the year after the two groups failed to reach an agreement over control.
AIB has been forced to dispose of its overseas assets to raise much-needed capital as it seeks to rebuild its business after suffering large losses on property writedowns.
Santander was advised by Bank of America Merrill Lynch and Nomura.
Story from Financial Times
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