April 28, 2020 / 7:18 AM / 2 months ago

Blackstone says NIBC deal uncertain without dividend payout

AMSTERDAM, April 28 (Reuters) - Private equity firm Blackstone said on Tuesday it would not be able to finance its proposed 1.36 billion euro ($1.47 billion) takeover of NIBC Holding NV if the Dutch bank continues to withhold its dividend over 2019.

NIBC decided earlier this month to postpone its dividend payments at least until the second half of this year, as European banks came under pressure to improve their capital positions to be able to weather losses caused by the global coronavirus outbreak.

Blackstone said this decision left a hole of almost 60 million euros in its offer, as it had committed to provide a little over 1.3 billion euros in equity, with the remainder to be financed with NIBC’s dividend payout.

It said it would try to work out a solution with NIBC that would lead either to direct payment of the promised 0.53 euros final dividend per share or at least a guarantee that the money would be paid before the settlement date of the offer.

“In the absence of this being the case, the offeror is not able to fund the acquisition of the shares,” Blackstone said in a statement.

Under Blackstone’s original proposal, U.S. private equity firm JC Flowers, which holds 60.6% of NIBC’s stock, would sell its stake for 8.93 euros per share, while Dutch investment firm Reggeborgh, which owns 14.6% of the group, would sell for 9.65 euros per share.

JC Flowers bought NIBC from Dutch pension funds in 2005 for 1.8 billion euros, but the financial crisis of 2008 derailed its plans to sell the bank at a profit.

The American firm eventually sought a listing for the bank in 2018, selling a 25% stake at 8.75 euros per share.

NIBC, which services around 600 small firms and 400,000 retail clients in the Netherlands, made a net profit of 194 million euros last year.

$1 = 0.9247 euros Reporting by Bart Meijer; Editing by Catherine Evans

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