Business World

Sunday 19 November 2017

Santander 'in final talks' on block deal for AIB's foreign holdings

Laura Noonan

Laura Noonan

SANTANDER could be edging closer to a block deal for AIB's foreign assets after the Spanish banking giant was reportedly invited for final talks on buying AIB's stake in Bank Zachodni.

Reports on Polish wire services yesterday claimed that Santander, and not local favourite PKO Bank, had been invited into the talks about acquiring AIB's majority stake in Zachodni.

"It makes sense for Santander to be invited back given their reported interest in a broader package of assets that AIB is being forced to sell," said Merrion analyst Sebastian Orsi.

The Spanish banking giant has also been mooted as a potential buyer for AIB's UK assets as well as its 22pc stake in US bank M&T.

AIB is hoping to agree deals to sell all three assets by September, as it pushes to improve its capital position by €7.4bn ahead of a regulatory deadline on December 31.

"A block bid from Santander would be positive in the sense that it could potentially give AIB more flexibility in terms of timing for its residual equity raise," said NCB analyst Ciaran Callaghan, who expects AIB to look to raise about €3bn from the market after making €4.5m from the disposals.

Davy's analyst Emer Lang said the reports of final talks with Santander "suggest the Santander bid must be a fairly strong one, given the Polish state's obvious keenness to keep the bank in domestic hands".

A spokesman for AIB last night declined to comment on the latest developments, citing the confidentiality of any disposal negotiations. Shares in Zachodni closed up 2.7pc on news of the possible Santander deal, ending three days of declines.

Irish Independent

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