Chinese group Fosun withdraws from purchase of Novo Banco

14 September 2015

The Bank of Portugal has contacted investment fund Apollo Global Management to see if remains interested in buying Novo Banco after the withdrawal of Chinese group Fosun International from the deal, Portuguese weekly Expresso reported Saturday.

Daily financial newspaper Diário Económico also reported that the sale of Novo Banco was expected to be postponed until after the Portuguese elections on 4 October. Apollo’s proposal, believed to be for 1.5 billion euros, was considered too low by both the government and Banco de Portugal.

According to the press, the US fund presented the second most interesting proposal to buy the bank that inherited the quality of assets of the bankrupt Banco Espírito Santo, despite the central bank deciding to talk to Fosun after the talks with Chinese group Anbang Insurance also failed.

If the sale of Novo Banco goes ahead it seems clear that the amount offered will not only below the 4.9 billion euros that the resolution fund injected into Novo Banco, but also below the 3.9 billion euros the state contributed to the fund.

French bank Société Génerale calculations cited by the Portuguese weekly suggest the sale will eventually be made for around 2 billion euros. (macauhub/CN/PT)