If Africa’s wealthiest woman gets her way, two of Portugal’s largest banks could merge, possibly making Angolans the top shareholders, according to Reuters and a report by Mike Bird in BusinessInsider.
Angolans are accustomed to Portuguese business interests affecting their country. This is different, according to the report.
In February, Spain’s Caixabank SA offered to buy the 55.9 percent of Portugal’s Banco BPI that it doesn’t already own. The deal, if successful, would make the Spanish bank the dominant player across the Iberian peninsula.
The daughter of the Angolan president and Africa’s first female billionaire, Isabel dos Santos wrote reacted to the takeover bid by the Spanish lender by suggesting another deal instead: a merger between Portugal’s BPI and BCP banks. BCP is Portugal’s largest bank by capitalization, WallStreetJournal reports.
The second-largest shareholder of Banco BPI, Dos Santos owns nearly a fifth of the bank, according to WallStreetJournal. Caixabank owns close to a half of Banco BPI, and it wants a majority stake, according to Reuters. A merger between the two banks was suggested in 2007 but failed to happen.
Sonangol, Angola’s state oil company, is the biggest shareholder in BCP with 20 percent ownership, FinancialTimes reports. If a BCP-BPI merger happens, Angolan investors would probably be the biggest shareholders in the new entity.
Dos Santos’ letter said the Caixabank takeover attempt of BPI doesn’t reflect the “true value” of the bank, making a merger a better option. A higher value would make her shares worth more money in a merger.
Dos Santos’ move complicates things for Caixabank, which will have to raise its bid if it wants to succeed. Her response sent stocks soaring, Reuters and Wall Street Journal reported.
Mergers and acquisitions often drive share prices up, BusinessInsider reports.
A merger between BCP and BPI would have to jump massive regulatory hurdles, given that both banks received state aid during Portugal’s recent bailout, according to FinancialTimes. BPI is seen as a top contender to buy Novo Banco, the “good bank” created when Banco Espírito Santo collapsed in 2014.