Cyprus companies being snapped up by Greek investors
Greek investors are taking Cyprus by a storm, snapping up companies from the services, technology and now the manufacturing sectors, making Greece the biggest foreign investor in Cyprus.
Supermarket chain Chris Cash & Carry was the target of a successful takeover by Greek retail and industrial giants Carrefour Marinopoulos earlier this year, while historic Coca Cola bottlers Lanitis Bros are about to be consumed by Coke’s biggest international partner, Hellenic Bottling Company, controlled, ironically, by the Cypriot Leventis family.
Greek direct acquisitions during the last four years are seen at CYP 170 mln according to Financial Mirror estimates, while more have been invested through the arrival of tens of Greek companies in Cyprus expanding their branch network here.
ACTIVE 2005
By far the biggest concluded mergers and acquisition (M&A) deal of 2005 is the 100% takeover of Chris Cash & Carry by Carrefour Marinopoulos at 32 cents per share for a value of CYP 21.6 mln.
However, the intention of the Hellenic Bottling Co. (3E) to acquire 100% of the share capital of local Coke bottlers, Lanitis Bros. Public Co., in a deal valued at CYP 50 mln by Financial Mirror estimates would overtake the Carrefour deal by a wide margin. More details regarding the takeover bid have been promised to be released by 3E on Thursday.
Also in the pipeline is a relatively small deal with an unknown Greek investor wanting to buy out Brainstorm, the local TGIF franchise holder, for about CYP 1.4 mln.
End of the December also sees the expiry of the bid offer by Aspis Pronoia of Greece to acquire 63% of the share capital of Universal Life Insurance Co. — 35% from CPB and 28% from BOC — for CYP 16.5 mln.
Meanwhile, Megabet has called an EGM on January 12 seeking approval of a resolution to issue 66.8 mln shares to Zenon S.A. of Greece at EUR 0.054 per share for a total deal value of EUR 3.5 mln or CYP 2 mln in cash.
In the event that the Lanitis and Brainstorm deals go through, these would boost the M&A deals from Greece during 2005 to CYP 75 mln, while in most likelihood the deal interest by Aspis to acquire UL will expire.
STEADY INTEREST
Last year there was only one major deal involving a Greek company when Jumbo S.A. acquired the remaining capital of the CSE listed Jumbo that it did not own at 59 cents for the shares and 6 cents for the warrants in a deal valued at CYP 2.1 mln.
A year earlier in 2003, OPAP S.A. was the most active, buying 90% of Glory Leisure for EUR 16 mln or CYP 9.3 mln cash and 20% of Glory Technologies for EUR 10 mln or CYP 5.85 mln in cash. In the same year, Intralot S.A. purchased a 50% plus one share stake in Royal Highgate at 12 cents per share for CYP 1.98 mln. The total value of the 2003 deals amounted to CYP 17.13 mln.
In 2002 the largest deal ever recorded between a Greek and Cyprus concern was the entry of Hellenic Petroleum into the Cyprus market by acquiring the 70 petrol stations of BP Cyprus for EUR 100 mln or CYP 55 mln.
During 2002 Delta S.A. also acquired a 61% stake in Charalambides Dairies in a deal estimated at CYP 17.2 mln raising the total 2002 amount to CYP 72.2 mln.
In addition to takeovers, there is a growing interest by Greek companies to expand directly into the Cyprus market, helped in part by the same language, customs and proximity.
In addition to the more established names like OPAP, National Bank of Greece (Ethniki) and its insurance subsidiary, Alpha Bank and Commercial Bank (Emporiki) which have been in Cyprus for many years and have now become household names, Cyprus also boasts the likes of OTEnet, Infote, Germanos, Marinopoulos Starbucks, Flocafe, Pouliades, Electroniki Athinon, while low-budget furniture store IKEA is opening up shop through its Greek franchise holder, Fourlis.
Many other private sector Greek companies already have a presence through selective retail stores, mostly in the clothing, household appliances and services sectors, while some Cypriot companies have introduced Greek franchise outlets to Cyprus or have secured international franchise rights for Cyprus and Greece.
