Seven bids for BCR received, while KBC and Fortis pull out of race

Seven of the nine banks on the list of investors interested in acquiring a stake of around 62% in Romania”s largest bank, Banca Comerciala Romana (Romanian Commercial Bank: BCR), have submitted their bids within the deadline.

Belgium”s KBC, and another Benelux-based lending institution, Fortis, dropped out of the race.

The first to rush to submit a binding bid for BCR was Belgium”s Dexia, followed, by Erste Bank AG (Austria), BNP Paribas (France), Millenium BCP (Portugal), Deutsche Bank (Germany), the National Bank of Greece and Banca Intesa (Italy), in that order.

Deutsche Bank, identified as one of the favourites by analysts, has reportedly offered 2.5bn euros for the stake being put up for sale, the Wall Street Journal Europe says.

Belgian lender KBC took the decision to withdraw from the race for Banca Comerciala Romana as early as midway through last week, market sources close to the investor say. The quoted sources added this bank had not given up on the Romanian market for good, however.

International analysts say Banca Comerciala Romana is worth approximately 3.8bn – 5.5bn euros.

The number and quality of the banks submitting bids reflects the amount of interest the BCR privatisation has generated internationally, as well as the efficiency and transparency of the due-diligence process. Over the last two and a half months, BCR has provided all potential investors with access to the information about the bank through its four data rooms and organised visits to branches and its headquarters. “We are pleased to see such extremely strong interest in BCR from some of the most important banks in Europe. We are confident that the privatisation process will have a beneficial impact on the Romanian economy and will speed up the integration of Romania”s banking system into the European banking system,” said Sebastian Vladescu, the chairman of BCR”s privatisation committee.

The first deadline for submission of final binding bids had initially been set for September 19, but was extended to October 17 after requests by contenders.

The procedures stipulate that the opening of the boxes containing the financial and technical bids and the participation documents will be performed today in the presence of all the bidders that will sign an acknowledgment. The privatisation committee for BCR will countersign this acknowledgment.

Over the next two weeks, the privatisation committee will name the institutions that submitted the two highest bids, which will then qualify to submit improved and final, binding bids.

According to the requirements of the privatisation committee, the price will account for 90% in the scoring of the bids used to differentiate the contenders, while only 10% will represent the technical criteria.

The first thing to be analysed among all the papers submitted will be the documentation that accompanies each bid, which includes, among other things, a banking guarantee of 19 million euros or documents certifying that the bidder in question possesses no outstanding debts to the Romanian state.