Piraeus Bank reiterated its goal of reaching the threshold of 9.9% of the capital of Bank of Cyprus, after confirming on the ASE that its total holding until last Friday amounted to 8.19%.
Piraeus said in an announcement that as stated in interviews given by the Vice Chairman Michalis Kolakides to Reuters and Bloomberg news agencies, the strategic goal of Piraeus Bank is to reach the 9.9% level of control.
Counter-bids
As developments are likely to intensify in the run-up to the BOC EGM on July 28 seeking shareholder endorsement to ratify its decision to seek control of Emporiki Bank of Greece, which may also include an improved offer in the event of a counter-bid by a third bank, Greek analysts suggest that Credit Agricole could still come as the “most suitable” bidder, if it decides to improve its cash offer from 23.50 euros per share to 26 or 27 euros.
Rumours in Greece also suggest that Alpha Bank may still step to seek control of Emporiki through a combined share and cash offer, totaling EUR 4.1-4.2 bln, which would be better than the EUR 3.1 bln bid placed by Credit Agricole and EUR 3.78 bln placed by BOC.
Greek press reports suggest that if Alpha Bank decides to bid, then it will offer 10-12 euros per share in cash and one Alpha share for every Emporiki share, with other reports insisting that in such a case, Alpha Bank would seek the support of a foreign bank such as ING or BNP Paribas or Unicredito with guaranteed offers set to reach EUR 4-5 bln.
Arbitrage
The stock market, meanwhile, continues to shrug off the takeover bids by both Credit Agricole and Bank of Cyprus judging from the quoted price of Emporiki on Sophocleous.
Trading at around 27 euros per share, the market insists to price Emporiki shares at a steep discount compared to the BOC bid, and at a steep premium compared to the Credit Agricole offer.
The BOC offer of 3.25 shares (7.60 euros) for every Emporiki plus 6 euros cash gives an indicative Emporiki price of 30-31 euros per share, or a 13% premium compared to the current traded price.
On the other hand, the quoted price of Emporiki at 27 euros is at 15% premium to the 23.50 euro all-cash bid by Credit Agricole, which means market participants are waiting for a possible third and more reasonable bid.
