A binding offer was made for the 68.91% stake that Banco Bilbao Vizcaya Argentaria SA holds in BBVA Chile. The Spanish lender said that the Bank of Nova Scotia, headquartered in Toronto, expressed the intention to pay $2.2 billion, and that the sum is appropriate. The proposition excludes wholly owned automotive financing entity Grupo Forum, said the press releases, published on Tuesday.
Most of the remaining holding is controlled by the Said family, which has the right of first refusal, meaning it can purchase the assets itself. Alternatives for the minority owner would be to sell its shares to the larger partner, which operates as Scotiabank, at the same price, or keep its cut of Banco Bilbao Vizcaya Argentaria Chile SA.
Net capital gain is seen at €640 million ($760.5 million) and fully loaded common equity tier CET1 would be strengthened by half a percentage point from the September level, BBVA estimated and said the valuation would come in at more than two times larger than book value and 20 times earnings. Scotiabank said the transaction would chip off one point from its own capital ratio, or 135 basis points if the minority stockholder divests its holding.
