Austrian bank agrees €1.6 billion PTSB deal
Austrian banking group BAWAG has agreed a deal to buy Permanent TSB (PTSB) in a deal that will be worth just over €1.6 billion.
The deal, recommended by the PTSB board, would net around €931 million for the State, which owns a 57.5% stake in the Irish bank.
PTSB announced last October that it had begun a formal sale process aimed at finding a new long-term owner.
A&L Goodbody LLP is acting as legal adviser to PTSB on the deal, while Arthur Cox LLP is advising BAWAG.
William Fry LLP acted as adviser to the Department of Finance.
High Court approval
The deal is expected to be implemented by means of a High Court-sanctioned scheme of arrangement under the Companies Act 2014.
In an announcement, the two banks said that the agreement was also subject to the approval of the requisite majority of PTSB shareholders and receipt of any necessary regulatory approvals.
BAWAG said that it was confident that the takeover would create a “highly credible competitor” to the two major Irish banks, AIB and Bank of Ireland.
“BAWAG and PTSB also believe that the acquisition has the potential to deliver significant benefits for customers, combining BAWAG's scale and capability with PTSB's deep roots in Irish communities to deliver an even stronger customer experience through greater choice, improved service and continued innovation,” they stated.
‘Physical presence’
PTSB's operations, products, and services are not affected by the announcement.
The Austrian group said that it recognised the importance of maintaining a physical presence in Ireland – including “maintaining PTSB's existing principal operations, customer-facing functions, meaningful branch presence, and key decision-making activities in Ireland”.
Tánaiste and Minister for Finance Simon Harris welcomed the announcement, adding that the State would be using its shares to vote in favour of the acquisition.
'Long-term vision'
He said that the new owner of PTSB had “a long-term vision for and commitment to PTSB and the Irish economy”.
“BAWAG’s demonstrated deep knowledge of the European and Irish banking sector can propel PTSB to an even more competitive position in the market, with the benefits of this to be seen by Irish consumers, businesses and the Irish economy more generally,” the Tánaiste stated.
Completion of the deal would mean that the State would exit its last remaining shareholding in an Irish bank after 17 years.