Civica Raises 600 Million Euros in IPO Following Bankia
Civica Raises 600 Million Euros in IPO, Following Bankia
Felipe Carnotto/Bloomberg
Civica and larger rival Bankia, which priced its IPO on July 18, both priced shares at a discount to peers to draw in shareholders as Spain’s borrowing costs reach euro-era records.
Civica and larger rival Bankia, which priced its IPO on July 18, both priced shares at a discount to peers to draw in shareholders as Spain’s borrowing costs reach euro-era records. Photographer: Felipe Carnotto/Bloomberg
Banca Civica SA, the lender formed from the merger of four Spanish savings banks, raised about 600 million euros ($849 million) in its initial public offering, pricing its shares at the bottom of the marketed range.
Civica sold 222 million shares at 2.70 euros apiece, according to a statement yesterday. The Madrid-based bank originally planned to sell stock at as much as 3.80 euros. The lender has an option to sell another 12 percent of the shares given sufficient demand.
Civica and larger rival Bankia SA, whose IPO also occurred this week, priced shares at a discount to peers to draw in shareholders as Spain’s borrowing costs reach euro-era records. Bankia raised more than 3 billion euros after slashing its IPO price by as much as 26 percent.
“These banks sold shares at a time of maximum stress for Spain and its financial system, and the pricing reflects that,” said Ofelia Marin, head of analysis at Banca March in Madrid.
Five Spanish lenders failed this year’s European Union stress tests after regulators found they didn’t have enough capital to withstand a potential crisis. Both Civica and Bankia passed, with a core Tier 1 capital ratio above the required 5 percent.
Banca Civica received total orders worth 1.1 billion euros and allocated 58 percent of shares to retail investors, 40 percent to institutional investors and 2 percent to staff, according to the statement. Demand from institutional investors was 1.3 times their portion while demand from retail investors was 2.3 times, the bank said.
Civica was priced at 0.4 times to 0.52 times its estimated book value, two people with direct knowledge of the deal said last week. The ratio for the average of eight listed Spanish banks was 0.67 as of July 20, data compiled by Bloomberg show.
To contact the reporters on this story: Zijing Wu in London at zwu17@bloomberg.net; Charles Penty in Madrid at cpenty@bloomberg.net
To contact the editors responsible for this story: Jennifer Sondag at jsondag@bloomberg.net; Frank Connelly at fconnelly@bloomberg.net
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