KBC Group becomes largest bank-insurance group in Bulgaria
Before closing of the transaction UBB intends to make a 183-million-euro extraordinary dividend payment to NBG subject to authorisation from the Bulgarian National Bank.
KBC will acquire:
- UBB (99.9%), the fourth-largest bank in Bulgaria in terms of assets with a 8% market share as at the end of September 2016 (11% market share in retail, 8% market share in corporate)
- Interlease (100%), the third-largest provider of leasing services in Bulgaria with a 13% market share,
The total consideration is 610 million euros. KBC will use internal sources/available funds to pay the acquisition price in cash.
The purchase price reflects the 183-million-euro extraordinary dividend and represents a 1.10x multiple of the 2016 expected Tangible Book Value of UBB and Interlease and a 1.29x implied multiple of the 2016 expected Tangible Book Value adjusted for negative net asset value adjustments amounting to 81 million euros which KBC identified during the due diligence process.
The acquisition will have a very limited impact on KBC’s solid capital position (-54 basis points), keeping the CET1 ratio (3Q16: 15.3%) well above regulatory minimum capital requirements. ■