M&A alert. Banca Transilvania buys Bancpost, ERB Retail and ERB Leasing

Banca Transilvania (BT) will take over Bancpost, ERB Retail Services IFN and ERB Leasing IFN from Eurobank, for an undisclosed sum.

The deal is pending the approval of the National Bank of Romania (BNR) and the Competition Council. According to the transaction’s timeline, BT aims to receive the green light from regulators by the second quarter of 2018. Until then, the two lenders will continue to operate independently.

Eurobank sold its operations in Romania as part of a restructuring program approved by the European Commission, the executive arm of the EU.

“Going forward Eurobank will concentrate and further develop its key markets. I would like to thank all our colleagues in our Romanian subsidiaries for the close and fruitful cooperation all these years as well as the fellows of BT for this successful outcome,” said Stavros Ioannou, deputy CEO of Eurobank.

Banca Transilvania – assets of EUR 11.9 billion

Meanwhile, Horia Ciorcila, the chairman of BT’s board of directors, said that the acquisition will “complement BT’s organic growth strategy so that we may further strengthen and consolidate our market position.”

BT is the seconds largest lender in Romania with assets worth EUR 11.9 billion and a market share of more than 13 percent. It has over 7,000 employees, 2.2 million units and around 500 units. Bancpost, meanwhile, has a market share close to 3 percent and total assets worth EUR 2.5 billion. The lender employs over 2,000 people, serving 1 million clients. Bancpost has a network of around 150 units.

Bancpost – assets of EUR 2.5 billion

Mediobanca – Banca di Credito Finanziario S.p.A. and HSBC Bank Plc acted as financial advisors to Eurobank in connection with the transaction. Law firms Shearman & Sterling LLP and Schoenherr si Asociatii SCA also worked on the seller’s side.

Barclays Bank PLC acted as a sole financial advisor to BT. PeliFilip provided legal advice, while Deloitte provided financial advice on certain accounting and diligence matters.

The price of BT per share was up by 1.63 percent to RON 2.1800 on Friday trading on the Bucharest Stock Exchange (BVB).