ECONOMY

EFG Eurobank wins bid for Bulgaria’s DZI Bank

SOFIA (Reuters) – Greece’s third-biggest lender, EFG Eurobank, announced on Friday it had agreed to buy Bulgaria’s DZI Bank in a 157.8-million-euro deal ($199.8 million) to extend its reach in eastern Europe. Under the deal, which will create Bulgaria’s third-largest bank, EFG Eurobank will pay private DZI Financial Group 110 million euros in cash and 2 million of its shares for 74.26 percent in DZI Bank. The Greek bank said it would merge its new acquisition with Post Bank, which it already controls, to boost its combined market share to over 10 percent in Bulgaria, a Black Sea country of 7.8 million people that is soon to be a member of the European Union. «The aim of EFG Eurobank is to consolidate the two banks to strengthen its leading positions on the fast-growing local market,» it said in a statement. The deal is pending relevant corporate and regulatory approvals. The Greek bank’s shares declined 0.66 percent, closing at 24.16 euros on Friday. Trade in DZI Bank was suspended last week due to the planned deal until Wednesday. EFG Eurobank said the purchase of DZI, Bulgaria’s 11th largest bank, follows its takeover of mid-sized Universal Bank in Ukraine and Tekfenbank in Turkey and the rollout of a branch network in Poland earlier this year. «The acquisition is consistent with the EFG Eurobank’s announced strategy to expand its operations in the most important markets of southeastern Europe,» it said. Eurobank is also present in Serbia, Romania and Albania. EFG Eurobank outbid Greece’s second-biggest lender, Alpha Bank, and Belgium’s KBC Group for DZI, which has 21 branches and 95 offices throughout Bulgaria. The deal puts DZI Bank’s total value at 212 million euros.