Bankia block trade could be delayed if share price remains weak - sources
Spain’s Orderly Bank Restructuring Fund (FROB) is in no rush to hold a block trade for Bankia [BME:BKIA] if no window appears, said a source and a person familiar with the situation.
The FROB has been gearing up for a November block trade, with February as a Plan B, it was reported last month. However, Bankia’s share price has fallen since then and a placement this year is looking unlikely as matters stand, said the source familiar.
Bankia’s shares are trading at EUR 3.91, giving it a market capitalization of EUR 11.27bn. This places the stock about halfway between its 52-week low of EUR 3.25 and its high of EUR 4.68.
The stock trended up through October, holding EUR 4.00 through most of the month, but has been falling since the end of the month.
The FROB is in no rush to hold the next block trade, said the person familiar with the situation. There is “no obligation” to do it this month, the person said.
The government-backed agency has until the end of 2019 to fully exit Bankia, the person said. If the privatization takes longer, it could ask for an extension, the person added.
The FROB is being advised by Nomura, while Bankia’s 67.5% shareholder Banco Financiero y de Ahorros (BFA) is being advised by Rothschild, the person said. The two financial advisers have put together a pool of pre-qualified banks for the accelerated bookbuild (ABB), the source said. The panel of banks are monitoring the market for a window, the person added.
Bankia is currently merging with another FROB-owned bank, Banco Mare Nostrum (BMN), in a deal which is expected to be closed next month. The deal is equivalent to just 6.67% of Bankia’s post-merger capital and an ABB could take place before the merger closes, this news service said in July.
A spokesperson for the FROB declined to comment.