Government to ask Citigroup to assess bids for Emporiki Bank

The government said late on Monday that it will authorize its adviser, Citigroup, to assess competing bids for the sale of its stake in Emporiki Bank and recommend the best option for the government, a senior Finance Ministry official said. Through a combination of direct and indirect holdings, the Greek government controls about 40 percent of Emporiki and is anxious to sell off its stake as part of a privatization agenda aimed at cutting the budget deficit. «The government has decided to authorize its adviser to begin the assessment of the two bids and any other bids, if there are any others,» the official said after a meeting of the government’s privatizations committee. «The adviser will assess whether the two bids are comparable,» the source added. France’s Credit Agricole and Bank of Cyprus (BoC) are competing to take over Emporiki, Greece’s No. 4 bank by assets. Credit Agricole, France’s biggest retail bank, has offered 23.50 euros a share in cash for Emporiki, valuing the Greek bank at 3.1 billion euros ($3.95 billion). Credit Agricole already controls 9 percent of Emporiki and 11 percent of the voting rights. Bank of Cyprus, the biggest lender on the island, has offered a mix of cash and shares, offering 3.25 of its own shares plus 6 euros for every share in Emporiki. Based on Monday’s closing price, the BoC bid is worth 26.80 euros a share. Government officials have said that Greece would prefer a cash offer, but would be willing to accept a combined cash-and-stock equivalent provided a price for the shares could be guaranteed. «We will request from our adviser that the adviser approach other banks to arrange a guaranteed price for the Bank of Cyprus bid,» the official said. Greece’s market regulator has set July 25 as the deadline for any new bids on Emporiki. After that, Credit Agricole and BoC will have an additional week to improve their offers, the official said. «If there are not any further offers by a third party, the two banks that have submitted bids so far will have until July 31 to submit improved bids,» the official said. (Reuters)