Sberbank hopes to lower VBI price to 500 mln euros - Der Standard
MOSCOW. Nov 23 (Interfax) - Sberbank Russia hopes to get the price of Volksbank International (VBI) down because VBI subsidiary banks have seen a downturn in their indicators, Austrian newspaper Der Standard reported citing sources from banking circles.
The Austrian paper's sources say Sberbank wants to bring the price down because VBI subsidiaries have posted worse than expected financial results with the Hungarian subdivision doing particularly badly.
In September, Sberbank signed an agreement on the acquisition of 100% of Volksbank International AG's (VBI) shares. Sberbank will acquire 100% of VBI's shares without the Romanian unit for 1x equity. The agreement says that the price of the shares could range from 585 million euros to 645 million depending on VBI financial results in 2011. Before the agreement was signed the price discussed exceeded 700 million euros.
Der Standard says the finalization of the deal is still a long way off: it needs to be approved by national banking regulators in eight countries. Many of these are not in any hurry, especially Hungary's central bank.
Vedomosti newspaper said last week, citing Sberbank Chairman German Gref, that the Russian bank is unlikely to try and get the price of VBI down. The situation in Europe will not affect the deal with Volksbank International - for Sberbank reputation is more important and the market's readiness to accept a new player, not a lower price, which has already come down twice, the paper said.
As reported the sale is expected to go through this year or at the latest by February 15 2012.