Bank Hapoalim BM, Israel’s second-biggest lender, offered to pay $42 million to acquire Turkey’s Adabank AS from the government’s banking receivership fund.
Hapoalim was the sole bidder in the auction today in Istanbul and its offer is below the minimum price of $90 million that Turkey put on the bank. The Savings Deposit Insurance Fund will now discuss whether to reject it.
“If the commission decides this bid is too low it will end this tender and can decide to reopen it,” Taner Yalcin, head of the sale commission, said after the bidding. “Or the commission can continue negotiations” with Hapoalim on Nov. 26.
It was Turkey’s third attempt to sell Adabank, the country’s second-smallest lender by assets, according to figures from the end of June on the website of Turkey’s banks association. An accord with Hapoalim would be the first major business deal between the two countries since relations soured after Israel’s attack on an aid convoy heading to Gaza in May, which left nine Turkish citizens dead. Hapoalim already owns Turkish investment bank Bank Pozitif & Kalkinma Bankasi AS.
Turkey’s banking industry has drawn investment from Western banks including BNP Paribas SA, Citigroup Inc., Dexia SA and ING Groep NV. Banco Bilbao Vizcaya Argentaria SA, Spain’s second-biggest bank, agreed on Nov. 2 to pay $5.8 billion for 24.9 percent of Turkiye Garanti Bankasi AS and may take full control in five years, expanding in Europe’s fastest-growing economy.
An acquisition would give the Israeli bank the right to collect consumer deposits in Turkey, since Adabank has the necessary licenses to do so, while Hapaolim’s Pozitif does not. “The plan would be to merge the two to collect deposits,” Oyak Securities said in an e-mailed research note today.
The Savings Deposit Insurance Fund, or TMSF, seized Adabank seven years ago from the Uzan family. Adabank had 50 million liras of assets at the end of June, according to the banks association. It has one branch and 46 staff.