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Eurobank controls Hellenic

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Eurobank Cyprus, the local subsidiary of the Eurobank Group with a presence in six countries, has acquired the 17% stake in Hellenic Bank held by Pimco to become the local lender’s biggest shareholder, controlling 46.5% of its shares.

The deal with asset managers Pimco is reportedly valued at €167.9 mln, or 235c a share, the above-market price at which Eurobank is now expected to make a public offer to all shareholders.

Hellenic shares opened trading on the Cyprus Stock Exchange Thursday at 229c, dipped early in the session to 226c and recovered to 228c by the end of the day.

If the deal is concluded with little resistance from other shareholders, the merged Eurobank-Hellenic will become the island’s biggest lender by far, having absorbed the ‘good bank’ operations of the now-defunct Cooperative Central Bank in 2018.

Before the takeover, Eurobank had already become the largest shareholder in Hellenic, having acquired the 12.6% stake held by Third Point in 2021 and subsequently accumulated 13.4% from Wargaming and 3.2% from Senvest.

Logicom-controlled Demetra Holdings is now the second biggest shareholder in the bank with a 21.3% stake, while Wargaming retains a 6.8% holding.

White knights

Third Point, Wargaming and Demetra were the white knights that rescued Hellenic following the 2012-2013 banking crisis, while rival Bank of Cyprus that absorbed toxic Greek bond-riddled Laiki Popular Bank required two bailouts and saw its shares diminish to a fraction of their value.

Bank of Cyprus restructured under an Irish holding company and listed its shares on the London Stock Exchange, in addition to the Cyprus bourse, where it is struggling to recover and currently trading at 262c a share, below the January 2017 listing price of 284c.

BoC recently started reporting healthy profits and paid a dividend earlier this year for the first time in a decade.

Eurobank’s gradual involvement in Hellenic has also paid off as it benefited from profits attributable to shareholders after Hellenic reported €24.2 mln in annual profits for 2022, jumping to €69.7 mln profits in Q1 and is on target for €200 mln profits this year.