Novo Banco Agrees to Sell Insurer Tranquilidade to Apollo

Novo Banco SA, the successor to Banco Espirito Santo SA, agreed to sell insurer Tranquilidade to private-equity firm Apollo Global Management LLC.

Terms weren’t disclosed. The shares of Tranquilidade had been given to Novo Banco as a pledge to secure a loan granted to Espirito Santo Financial Group, a unit of the Espirito Santo Group that requested creditor protection in July.

“When completed, the sale will permit the execution of this pledge,” Novo Banco said today in a regulatory filing. The deal with Apollo “represents the best offer” received for Tranquilidade, the Lisbon-based lender said.

Espirito Santo Financial Group has challenged the sale of Tranquilidade by Novo Banco, saying it would “legally react” against the move. ESFG said in a regulatory filing on Aug. 29 that it hadn’t been “notified of the execution of the pledge” to transfer its stake and was therefore “still the owner” of Tranquilidade.

Today’s deal is subject to “a number of conditions” including regulatory approval, according to the filing.

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