Russia based Sberbank has inked an acquisition agreement to buy Franco-Belgian group Dexia's Turkish unit DenizBank, for TL6.5bn ($3.6bn), which is claimed to be one of Europe’s biggest banking deals so far this year.
Dexia rejected Qatar National Bank’s bid to acquire, saying that it is too low for DenizBank, said the firm.
As per the deal, Sberbank will shell out the equivalent of 1.4 times Denizbank’s book value and upon completion of the transition, the Russian state-owned lender hopes to enhance its footprint in Turkish banking sector.
According to industry sources, Dexia is being split under a plan started by the French and Belgian governments after it reached on the verge of collapse in October, last year.
Dexia said that it is disposing its DenizBank to meet the stringent capital requirements and to rebuild their capital levels, although the bank reported first-quarter net income of TL180m, up by 21% than in the same period in 2011.
Sberbank seems to be indifferent from the eurozone crisis, as its net profit grew by 74% last year and 6% year-on-year in the first quarter of this year.
Tier one capital adequacy ratio, a core measure of a bank’s strength, stood at a healthy 11.8% at the end of March.
Sberbank is also acquiring banks and financial firms overseas, as a part of its strategy to strengthen its international banking operations.
In this line, Sberbank acquired VBI from Austrian lender Volksbanken AG for $629.43m in February, this year.
Sberbank is being advised by Rothschild, Deutsche Bank and Troika Dialog on the deal, while Bank of America Merrill Lynch is advising Dexia.