CySEC Chairman Advocates Mandatory Public Offer by Eurobank for Hellenic Bank Acquisition

George Theocharides, the Chairman of the Cyprus Securities and Exchange Commission (CySEC), has emphasized the necessity for Eurobank to proceed with a mandatory public offer to acquire the entire capital of Hellenic Bank. In an interview with the Cyprus News Agency (CNA), Theocharides stressed the importance of adhering to regulatory processes and compliance in transactions of this nature.

Eurobank recently announced its intent to acquire a 17.3 percent stake (71,428,572 shares) in Hellenic Bank from Poppy S.à r.l. The agreed price for this stake amounts to €167.9 million (€2.35 per share), with potential adjustments based on factors including the transaction's completion date and subsequent public offer terms.

Upon the successful acquisition of the additional 17.3 percent stake, Eurobank's ownership in Hellenic Bank is set to rise from 29.2 percent to 46.5 percent. However, the transaction remains contingent on receiving regulatory approvals.

The CySEC Chairman elaborated on the necessary legal steps for Eurobank's augmented stake acquisition in Hellenic Bank. These steps involve securing approvals from supervisory authorities, including the Central Bank of Cyprus, the European Central Bank, the Single Supervisory Mechanism, and the Commission for the Protection of Competition. Theocharides highlighted that this procedural phase is anticipated to span several months.

Addressing the legislative framework in Cyprus, Theocharides clarified that if a company acquires more than 30 percent of the share capital of a listed entity, it is mandated to extend a public offer to the target company's shareholders to acquire the entirety of its share capital.

To establish control, Eurobank needs to secure at least 50 percent plus one share of Hellenic Bank's shares. While the acquisition of 46.5 percent is pending regulatory green lights, an additional 3.5 percent plus one share is required to fulfill this criterion.

Responding to inquiries about Hellenic Bank's potential delisting from the stock exchange following Eurobank's attainment of 50 percent plus one share, Theocharides negated the need for delisting. He clarified that for a public company to delist, an acquisition exceeding 90 percent of its share capital is necessary, thereby facilitating a squeeze-out of minority shareholders.

In the event of an unsuccessful public offer, Theocharides outlined that Eurobank would face a restricted period during which it cannot pursue further share acquisitions of Hellenic Bank. Subsequent to this interval, Eurobank could explore the possibility of presenting a new public offer.

Theocharides' stance underscores the importance of adhering to regulatory protocols in ensuring the integrity and transparency of financial transactions, particularly in significant acquisition endeavors within the banking sector.

By fLEXI tEAM