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EBRD sells its shares in Czech-based CSOB to KBC
Sale increases KBC’s stake to 97.5 per cent
The EBRD has sold its 7.47 per cent stake in the CSOB Bank, a financial
institution active in both the Czech and Slovak Republics, to KBC Bank NV,
after supporting the bank’s development and its partnership with a key
strategic investor since privatisation in 1999.
The purchase takes KBC’s holding in CSOB from 89.9 per cent to 97.5 per cent.
KBC bought 381,365 CSOB from the EBRD, under a Put and Call Option Agreement
dating back to the time of the privatisation.
The acquisition of the EBRD stake in CSOB fits in with KBC’s current long-term
commitment to its Central and Eastern European home market and will further
consolidate its position as one of the biggest investors in the region.
In 1999, the EBRD purchased a 7.47 per cent stake in CSOB from the National
Bank of Slovakia (NSB). The sale was made alongside KBC Bank, which purchased
16.63 per cent held by the NBS, after having already purchased a stake from
the Czech government.
Kurt Geiger, Business Group Director, Financial Institutions at the EBRD, said
that today’s sale is a strong example of the Bank's mandate to support the
transition process across the Bank’s countries of operations. The EBRD played
a key role during the CSOB privatisation by offering strategic investors an
important sense of comfort in a politically sensitive environment. The sale
today highlights the EBRD's ability to help strengthen financial institutions,
and demonstrates seven years of successful cooperation between the EBRD, KCB
and CSOB. The successful development of CSOB was evidence that the Bank had
fulfilled its tasks and it was therefore the right time to exit from this
investment.
Now that KBC owns more than 90 per cent of CSOB, it can choose, under Czech
law, to buy out remaining minority shareholders. KBC intends to exercise this
right with regards to the rest of the owners who hold the remaining 2.5 per
cent of shares. An independent expert will assist KBC in determining the fair
value of the CSOB shares.
KBC is aiming to expand in those Central and Eastern European markets where it
already has a presence. It plans to do so by speeding up organic growth, with
additional bank branches in Poland, Hungary, the Czech Republic and Slovakia,
and by buying out, wherever possible, existing minority shareholders. KBC Bank
has already reached an agreement with ABN Amro in December 2005 to buy its
40.2 per cent stake in the Hungarian Kereskedelmi és Hitelbank (K&H Bank),
raising KBC’s shareholding from 59.4 per cent to 99.6 per cent. In 2006, KBC
acquired full ownership of Warta, the Polish insurance group company.
Commenting on today’s transaction, André Bergen, CEO of KBC Group NV, said:
“By increasing our ownership, KBC is reaffirming its long-term commitment to
CSOB. Since 1999, KBC has been a loyal and strategic partner for CSOB. The
next step we are taking today fits in perfectly with KBC’s strategy of further
developing and deepening its activities in Central and Eastern Europe.
Competition is fierce in the Czech banking and insurance sector, which is why
it is important for both the customers and employees of CSOB that the
shareholders of the company focus not solely on profitability and growth, but
also view this as a long-term strategic investment. Our close and
ever-increasing involvement in the day-to-day business of CSOB has shown that
KBC’s commitment is a lasting one.
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