Fosun International mulling purchase of Novo Banco Ásia’s parent bank

By
Joao Santos Filipe

The Portuguese Central Bank is negotiating the sale of Novo Banco, the parent company of Novo Banco Ásia, with the Chinese group Fosun, according to the Portuguese press.
The news emerged before the Portuguese Central Bank issued a press release announcing that the exclusive negotiations with the Chinese group Anbang for the sale of the rescued bank had collapsed.
According to local press, the acquisition of the parent bank of Novo Banco Ásia by Anbang failed because the Chinese group was not willing to assume the responsibility of future capital increases that may be necessary. At this moment the bank is going through stress tests and the results may require this capital increase.
In a statement, the Central Bank also clarified that the negotiations for the sale of the rescued bank would begin with the second best offer of the public tender, which is said by local press to be by Fosun International. This news comes as a surprise as it had always been reported that the second best offer was from American group Apollo Global Management.
The goal of the Portuguese Government is to complete the negotiations with Fosun International within ten days. However, for negotiations to succeed Fosun would have to meet the initial bid from Anbang, which was around 3 billion euros (MOP27 billion).
The Chinese group now invited to start negotiating is already operating in Portugal as it controls insurance company Fidelidade (which has a branch in Macau) and the private hospital group Luz Saúde.
Should negotiations with the Shanghai-based group fail, the Portuguese bank can still negotiate with Apollo Global Management as its final option for the sale.
Following an initial public tender for the sale of Novo Banco, Fosun International, Anbang and Apollo Global Management were the selected contenders to buy the Portuguese bank.
Novo Banco was created in August 2014 from the healthy assets of Banco Espírito Santo (BES), which was split into ‘good’ and ‘bad’ banks after being rescued by the resolution fund of the Portuguese Central Bank. The so-called good bank, which includes Novo Banco Ásia, is wholly owned by the resolution fund and is not listed on the stock market.