BILBAO (dpa-AFX) - Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) said Monday that it has agreed to acquire bailed-out Spanish bank Catalunya Banc S.A. for a price of up to 1.187 billion euros, or $1.61 billion.
BBVA, Spain's second-largest bank, won an auction for Catalunya Banc. The Spanish government nationalized Catalunya Banc in 2011 and invested about 12.6 billion euros to prevent the bank from collapse.
Accordingly, BBVA has executed a sale and purchase agreement with Management Commission of the Banking Restructuring Fund or FROB, which will sell the entire shares of Catalunya Banc to BBVA. FROB is Spain's bank rescue fund.
BBVA noted that the acquisition price will be reduced by 267 million euros to 920 million euros if FROB and Catalunya Banc do not obtain a confirmation from Spanish tax authorities about the application of deferred tax assets to some losses recorded in Catalunya's transfer of assets.
Closing of the transaction is subject to the effective closing of the transaction announced by Catalunya Banc on July 17, 2014 that it will transfer a loan portfolio with a nominal value of 6.392 billion Euros to an asset securitization fund.
Catalunya Banc said last Wednesday that it closed the sale of a loan portfolio to private equity firm Blackstone Group LP (BX) with a nominal value of 6.39 billion euros and provisions amounting to 2.21 billion euros.
The transaction consists of transferring the portfolio to an asset securitisation fund for an amount equal to its carrying value in the bank of 4.19 billion euros. Blackstone will acquire the senior bonds for 3.62 billion euros, while FOBR will acquire the junior bonds for the remaining 572 million euros.
BBVA closed Monday's trading at $12.13, down $0.06 or 0.49 percent on a volume of 1.04 million shares.
Copyright RTT News/dpa-AFX