Alior Seeks $773 Million in Record IPO by Private Polish Company

Alior Bank SA, the fastest-growing Polish lender, is seeking to sell as much as 2.5 billion zloty ($773 million) of shares in what is set to be the biggest initial public offering by a private Polish company.

Alior plans to raise 700 million zloty from a new share sale and Carlo Tassara SpA, its founding company owned by French investor Romain Zaleski, will offer 26 million shares, the Warsaw-based bank said in a prospectus today. Alior, which is offering as many as 51 million shares, will cut the sale by 15.1 million if the final price is set at the upper limit of 71 zloty a share, it said in a separate statement today.

The bank, which has built the third-biggest branch network in Poland since its creation in 2008, needs funds to boost lending and fight competition as Banco Santander SA of Spain and Polish billionaire Leszek Czarnecki’s Getin Noble Bank SA step up expansion. Carlo Tassara will sell a further stake of at least 30 percent in Alior to a bank or an insurer by the end of 2013 to lower its own debt, according to the prospectus.

“The sale is pricey, particularly when we take into account the risk that the economy will slow next year and may cut demand for loans,” Jaroslaw Niedzielewski, who helps manage the equivalent of $447 million at Investors TFI SA in Warsaw, said by phone. “It’s also hard to say at the moment who could buy the controlling stake” from Carlo Tassara.

Based on the maximum IPO price and after the planned capital increase, the bank is valued twice its shareholders’ equity, Marta Czajkowska-Baldyga, an analyst at KBC Groep NV said by phone from Warsaw today. PKO Bank Polski SA and Bank Pekao SA, Poland’s largest lenders, trade 1.8 times their book value, according to data compiled by Bloomberg.

Record IPO

The IPO will be the biggest in Poland since state-owned coal group Jastrzebska Spolka Weglowa SA’s 5.37 billion-zloty sale in 2011 and the largest by a Polish company owned by private investors, according to data compiled by Bloomberg. The previous biggest IPO by a private Polish company was the 1.1 billion-zloty sale of property developer LC Corp SA in 2007.

The European Bank for Reconstruction and Development agreed to buy as much as 320 million zloty of Alior shares, according to the prospectus. Individual investors will be offered no more than 5 percent of the IPO and some of them will buy shares at a discount.

The final price will be set on Dec. 4, when bookbuilding for institutions ends. Investors will acquire a 67 percent stake in the IPO if all shares are sold. The bank plans to start trading in Warsaw by Dec. 14, it said. Barclays Plc, JPMorgan Chase & Co., Morgan Stanley, Ipopema Securities SA, Erste Group Bank AG and Renaissance Capital manage the offering.

Alior’s net income almost tripled to 222.9 million zloty in the first nine months of 2012. With more than 680 branches, the bank has the biggest network after state-controlled PKO and UniCredit SpA’s Pekao. The bank plans to double its share in the Polish banking market to about 4 percent in the medium term.

Warsaw’s WIG Banking Index has jumped 15 percent this year, compared with an 11 percent gain of the benchmark WIG20 Index. Polish banks’ combined profit rose 0.3 percent to a record 12 billion zloty in the first nine months as loans grew, according to data from the Polish financial regulator.

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