Banco Santander SA, Spain’s biggest lender and Eurozone’s largest bank by market captalisation, has launched a 16.6 billion zloty ($5.8 billion, €4.29 billion) bid to acquire a 100 percent stake of Bank Zachodni WBK SA – the Polish lender in which it had agreed to buy a 70 percent stake from Allied Irish Banks Plc lat year.
In a filing with regulators in Madrid, Santander said it has offered to pay 226.89 zloty for each share of Zachodni and the bidding process will run between February 24 and march 25, subject to clearance from Poland’s banking regulators. The offer is valid for 70 percent of AIB and 30 percent minority shares.
AIB has been instructed by the Irish government to strengthen its balance sheet after it was badly hit by the country’s property slump. Santander has plans to grow aggressively out side Spain, especially in the emerging markets and the US and the UK, as part of its strategy to reduce its dependence on the domestic market after the country witnessed the worst recession in sixty years.
Santander’s net profit declined by 8.5 percent in 2010 to €8.18 billion, largely due to write offs and provisions for bad loans.
Although Santander’s offer was expected, the market had expected it to wait until it received regulatory approval for buying AIB’s share.
Santander had managed to outbid other contenders in last September for 70 percent of AIB’s stake – French giant BNP Paribas and Polish bank PKO, by offering 11.66 billion zlotys.