Bank of Cyprus wants MFS to cover debt

Bank of Cyprus Pcl (BOCY) has clarified that the agreement for the sale of a 28% stake in Universal Life Insurance to Andreas Geroghiou and Photiades Group was signed on July 13, 2006 and since payment has been received and most regulatory permits secured, there is no issue of renegotiation of the said contract.

BOCY agreed to sell its stake in UL at CYP 2.10 per share and gave the buyers until January 13, 2007 to settle the outstanding issues. Bank of Cyprus announced that on January 13, 2007, the buyers settled the balance of the amount due, but since there were still some regulatory documents pending, it was decided to extend the deal for another 3 months.

As regards the interest of MFS Holdings in the stake, this was conveyed to the Bank on January 10, 2007 through issue advisors Sharelink Securities & Financial Services, who offered CYP 2.50 per share. A new letter sent on January 30, 2007 improved the price to CYP 3.00 per share.

Bank of Cyprus however, clarified that MFS Holdings Pcl owes the Bank the sum of CYP 3 mln or EUR 5.2 mln and against it a court order has been issued since February 17, 2005 to pay its overdue balance to the Bank, which it has not yet done so.

Bank of Cyprus said it replied to Sharelink and MFS informing them that the agreement with Andreas Georghiou and Photos Photiades Group were binding, and hence it could not alter the terms.