Published: April 10, 2012
Deal with Kuwait’s Burgan Bank will shore up vendor’s tier 1 capital ratio.
Greece’s Eurobank EFG is selling its Turkish business to Burgan Bank of Kuwait for TRY641mn (US$356mn).
KIPCO-owned Burgan will acquire 99.3% of Eurobank Tekfen from Eurobank EFG and the Tekfen Group in a deal expected to close during the third quarter following regulatory clearance.
The sale will boost Eurobank EFG’s core tier I capital ratio by some 60 basis points and improve its liquidity position.
Eurobank EFG bought 70% of Eurobank Tekfen from the Tekfen Group in 2007, with an option to acquire a further 29.3% at a later date. Since 2007, Eurobank Tekfen has more than tripled the size of its loan portfolio to €1.5bn (US$1.9bn), doubled its branch network, and increased profitability.
Barclays and Goldman Sachs International are financial advisers to Eurobank EFG. Citi advised Burgan Bank.
Eurobank EFG group also operates in Bulgaria, Serbia, Romania, Poland, Ukraine, the UK, Luxembourg and Cyprus, and has assets of €81.6bn.