Of Special Interest
23rd December 2011
Qatar firm buys majority of Dexia Luxembourg
Precision Capital is to purchase 90% of Dexia Banque Internationale à
Luxembourg S.A. and the Grand Duchy of Luxembourg the remainder. The deal values the Luxembourg bank at €730m (£608m $953m ¥74.2bn Y6,040m). The purchase price is a little over five times 2010 earnings. The deal requires regulatory permissions including from the European Commission.
Precision Capital is a Qatar investment company linked with the country's royal family. The Luxembourg's stakes in Dexia Asset Management Luxembourg and RBC Dexia Investor Services Limited will be disposed of shortly. The portfolio of Legacy securities of Dexia Banque Internationale à Luxembourg as well as its stakes in Dexia LDG Banque and Parfipar will be transferred to Dexia prior to the closing of the transaction.
Following a second round of state aid the European Commission requires Dexia to be broken up. The focus will now be on the sale of its asset management unit and Denizbank, the Turkish bank owned. Both are likely to receive multiple bids. Sberbank preciously showed interest in Denizbank and identified Turkey as a priority country for expansion however last week said it was making a pause in its international acquisition spree.