Panayiotis Rougalas
Eurobank is gaining control of Hellenic Bank after purchasing Wargaming's 13.4% stake. With the addition of the 12.6% it held from the purchase of all shares in Third Point Hellenic Recovery Fund in the summer of 2021, it now stands at 26%.
Eurobank was scheduled to make official announcements on Thursday, December 1. Eurobank Bank has agreed to purchase a 13.41% stake (55,337,721 shares) in Hellenic Bank Public Company Ltd ("Hellenic Bank") for a total consideration of €70,000,000.
As a result of this transaction, Wargaming retains a 7.8% stake in Hellenic Bank, after previously owning 20.2% of the company. As K is aware, Wargaming kept this stake in order to sell it at a later date, possibly at a higher price.
Wargaming owns 20,2% of Hellenic Bank, which equates to 83,3 million shares out of Hellenic Bank's total number of issued shares (412 million is the number of issued shares of Hellenic). Based on the calculations of "K" the bank may have wanted to buy about 56 million shares from Wargaming on the evening of Wednesday 30 November, so taking into account the price at which the Hellenic share closed on Tuesday (1.24 euros), the "deal" would amount to about 70 million euros. In the end, the transaction cost 70 million dollars, and 55 million shares were purchased.
As can be seen, Eurobank still needs 4% to fully control Hellenic Bank.
Top management seemed happy and approved of the deal
According to sources close to domestic regulators, Eurobank's continued operations for Hellenic are giving them complacency as shareholders with banker and banking experience. They all have the approval of the supervisors.
Eurobank sources told K that with this move, they are demonstrating their confidence in the Cypriot economy in practice. When they purchased the stake in Third Point, they stated in their statement that the investment is in line with the Eurobank Group's strategy to strengthen its presence in all key markets in which it has a strategic interest. The same statement was made in the Wargaming deal: 'This investment is aligned with Eurobank Group's strategy to further strengthen its presence in all key markets in which it has a strategic interest and is a vote of confidence in the Cypriot economy'.
According to Hellenic Bank sources, the development is positive because it demonstrates a vote of confidence in Hellenic by a major Greek banking institution.
Third acquisition since 2021
This is Eurobank's third acquisition since 2021, following the acquisition of Direktna Bank in Serbia in early July 2021. In July of the same year, it acquired 9.9% of Hellenic Bank in the first stage from Third Point Hellenic Recovery Fund and entered into a share purchase agreement to acquire an additional 2.7% stake. Eurobank's stake in Hellenic increased to 12.6% following the completion of that transaction.
Eurobank's overseas expansion policy is consistent with the bank's strategic goals, and it is being implemented in three key markets outside of Greece: Bulgaria, Serbia, and Cyprus.
Hellenic Bank's major shareholders
With a 26% stake, Eurobank S.A. becomes a major shareholder in Hellenic Bank. Demetra Holding Plc is the second largest shareholder, with 21.3%, and Poppy Sarl (Pimco) has 17.3%. Wargaming maintains its 7.6% share, while Senvest has 5.1%. The remaining 23.5% of Hellenic is held by "other" shareholders.
The acquisition is subject to regulatory approvals and will be completed once all of them have been obtained. Until then, Wargaming Group Limited will retain full legal and beneficial ownership of the shares for sale, as well as all rights to them.
