Bendigo & Adelaide Bank Ltd. shares fell the most in almost four months in Sydney after the company increased the size of its equity sale to fund the purchase of Bank of Cyprus Plc’s Australian unit.
The Bendigo, Australia-based bank sold A$150 million ($149 million) of stock, more than the A$120 million it announced last week, at A$8.45 apiece, it said in a statement today. The shares, which resumed trading today after being halted at A$9 on Dec. 15, fell 5.1 percent to A$8.54 at 10:53 a.m., the most since Aug. 29.
Bendigo & Adelaide said last week it agreed to pay A$130 million for Bank of Cyprus Australia Ltd., which has 14 branches in New South Wales, Australia’s most populous state, as well as Victoria and South Australia. The Hellenic lender’s unit has interest-bearing assets of A$1.4 billion. The acquisition is due to be completed by the end of February, subject to regulatory approval.
While the purchase of Cyprus Australia is “an expensive deal that relies on large synergy benefits for accretion, we think it is more about the capital raising than the deal itself,” Deutsche Bank AG analysts in Sydney including Andrew Triggs wrote in a note to clients dated Dec. 16. They have a “hold” rating on the stock.