The “power game” within the bank at the shareholder level will intensify in the next period
a bold”> By Panagiotis Rougalas
With an eye on the next day is Eurobank after the end of the public offer for the acquisition of 100% of Hellenic Bank which was completed at noon on Tuesday, June 30, 2024. Although the percentages of Eurobank in Hellenic Bank were not announced immediately after the end of the public offer , the bank kept a small basket for the size of the rate it will have at the end of the process. The percentage that would be brought by the end of the process would indeed be greater than the 55.48% that the bank currently has, however it did not appear that the two major shareholders of Hellenic Bank, Dimitra Investments and ETYK, would apply for the sale of their shares with shares through its funds. Eurobank is now focused on Hellenic Bank's (HB) Annual General Meeting (AGM) in September, where, as “K” wrote again, it will start implementing its plans for the newly acquired bank. Among its plans are new managers in key positions that will enable it to implement the strategy it has established for the largest retail bank on the island.
The “power game” within the bank at the shareholder level from the September AGM onwards will inevitably intensify and sooner or later the lines that will be followed by the three major shareholders of the bank (Eurobank, Dimitra, ETYK) will be seen. It is recalled that Eurobank has so far, i.e. since the summer of 2021, not been interested in putting any of its own people on the Board of Directors (BoD) of Hellenic Bank, something that will change next September. Several positions on the Board of Directors that were either representatives of old shareholders, or were “close” to the interests of some shareholders, will be vacated. Besides, Eurobank controls Hellenic with its 55.48% stake in the bank, but at the level of the Board of Directors. he didn't control her. There are 11 positions on the Hellenic Council, which with simple calculations by “K”, either four new persons will enter, up to six who will be close to the interests or represent Eurobank.
Among the its plans are for new managers to enter key positions, which will enable it to implement the strategy it has established
Turning to the public proposal, Eurobank will have six months to come back with a new proposal to increase its shares in Hellenic Bank. In practice, until the beginning of 2025, Eurobank will implement the plan it has as the major shareholder in Hellenic, while Eurobank Cyprus will also “run” as it is today with “business as usual” procedures, and we will not see merger actions that could to be made if Eurobank acquired 75% of Hellenic. At this stage, whether Eurobank had 74% or 55.48% and more, it has the same result for its action in Hellenic Bank. However, the heads of Eurobank made it clear months ago that even with 55% and more they could proceed with what they have strategically planned for Hellenic Bank.
4 weeks< /h3>
Eurobank chose not to exhaust the entire 8-week period it was entitled to for the public offering. Hellenic shareholders had 4 weeks to decide whether to request the sale of their shares. The Acceptance Period of Eurobank's Public Offer to Hellenic Bank shareholders began on July 1, 2024 to acquire shares at 2.56 euros. On the date of the announcement of the public offer, Eurobank directly owned 229,029,857 shares, i.e. 55.48% of the issued share capital of Hellenic Bank.
The Board of Directors is strict.
In the middle of the process of the public offer of Eurobank, this Board of Directors of Hellenicia proceeded – as it should – with the so-called “fairness opinion”, assigning a foreign expert to judge the 2.56 euros per share offered by Eurobank to the shareholders of Hellenicia. The Board of Directors of Hellenic adopted the opinion of the independent expert of Houlihan Lokey UK Limited that the proposal for 2.56 euros per Hellenic share proposed by Eurobank was not fair and reasonable.
According to the analyzes of the Independent Expert of Houlihan Lokey UK Limited, the valuation reference ranges were €3.31 – €4.12 per share, i.e. 29.3% – 60.9% higher than 2 .56 euros per Eurobank share. The Independent Expert also considered a scenario where Eurobank will not distribute the estimated excess distributable capital to the shareholders. The results of this analysis presented the valuation reference ranges at 2.78 euros – 3.62 euros per share, i.e. 8.6% – 41.4% higher than the 2.56 euros per share of Eurobank .
Quarterly Profits
According to Eurobank's official results for the first quarter of 2024, its adjusted net profit amounted to 383 million euros in the first quarter of 2024 and 92 million of them were brought by Eurobank Cyprus and Hellenic Bank. In more detail, from its investment in Hellenic the group made an adjusted net profit of 41 million euros and 52 million came from Eurobank Cyprus.
