CaixaBank Is Said to Be in Talks With Dos Santos Over BPI

  • CaixaBank says it's in talks with Santoro on BPI, Angola
  • Dos Santos last year opposed CaixaBank's offer for BPI stake

CaixaBank SA is in talks with Angolan investor Isabel dos Santos to acquire her stake in Portugal’s Banco BPI SA, according to people with knowledge of the matter.

Spain’s third-largest bank and dos Santos, the daughter of Angolan President Jose Eduardo dos Santos, may reach an agreement over the approximately 21 percent stake in the coming days, said two people who asked not to be identified because the matter is private. A purchase would force CaixaBank, which already owns 44 percent of the bank, to make an offer for the entire company.

CaixaBank is seeking to increase its stake in BPI after last year scrapping a 1.1 billion-euro ($1.1 billion) offer to buy the remaining 56 percent in the Portuguese bank that it didn’t already own. That stake has a current market value of about 966 million euros, according to Bloomberg data. BPI’s board is seeking to remove a rule restricting a single investor’s voting rights to 20 percent as it may “condition” the involvement of shareholders.

CaixaBank “is between something of a rock and a hard place on its 44 percent long standing holding in BPI,” Benjie Creelan-Sandford, an analyst at Nomura, said in a note. “Given the difficulty of disposing of the stake, a takeover could be the best option as it would give greater management control and offer scope for potential cost savings.”

BPI shares rose as much as 12 percent to 1.199 euros, the highest since June, before they were suspended from trading in Lisbon by Portuguese securities regulator CMVM. CaixaBank shares climbed 3.7 percent to close at 2.70 euros, paring losses this year to about 16 percent.

No final decisions have been made and the talks may still fall apart, the people said.

Dos Santos, BPI’s second-biggest shareholder, opposed CaixaBank’s offer last year. Her holding company, Santoro Finance, has an 18.6 percent stake in the company. She controls another 2.3 percent holding through Angolan bank Banco BIC SA. Dos Santos is BIC’s biggest shareholder with a 43 percent stake.

The BPI voting cap also enabled dos Santos, at a shareholder meeting earlier this year, to reject a plan by BPI to spin off its African operations, which include Angolan lender Banco de Fomento Angola. The move aimed to comply with a request by the European Central Bank for BPI to reduce its exposure to the African nation by April 10.

CaixaBank and Santoro said in separate statements late on Wednesday that they have been in contact to try to find a solution for the Portuguese bank’s exposure to Angola. They did not provide details about the possible solutions.

“CaixaBank and Santoro Finance have explored different alternatives to reach a solution for that situation,” CaixaBank said in a regulatory filing. “Until now, a solution hasn’t been reached.”

It’s “inevitable” for CaixaBank to be in talks with Isabel dos Santos about BPI, said Tiago Violas Ferreira, whose family-owned Holding Violas Ferreira has a 2.68 percent stake in BPI. If BPI’s Angolan unit Banco de Fomento Angola is used as a bargaining chip for those shareholders to reach an agreement then “the interests of the small shareholders may be hurt,” he said in an interview on Wednesday.

Dos Santos has offered 140 million euros to buy an additional 10 percent stake in Banco de Fomento Angola through Unitel, a mobile company where she holds a 25 percent stake. BPI said on Jan. 27 it rejected Unitel’s offer. BPI owns 50.1 percent of BFA, with the rest held by Unitel.

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