Permanent TSB Group Holdings PLC dismissed a possible takeover approach from corporate advisory firm Axis Capital Ltd on Monday morning, characterising the announcement as “highly speculative and conditional” while reaffirming its commitment to an agreed acquisition by Austria’s Bawag, according to reports by Alliance News.
Permanent TSB Dismisses Axis Capital Approach
Axis Capital, cofounded three years ago by former Bank of Scotland (Ireland) chief executive Mark Duffy and German corporate lawyer Lutz Hartmann, stated on Friday evening that it was considering a cash bid for Permanent TSB at €3.20 per share. That potential price sits 7.7 per cent above the €2.97 per share agreed with Bawag in April, which values the Dublin-based bank at roughly €1.62 billion, according to Alliance News. However, Axis signaled in its announcement that it has not yet lined up funding for the proposed transaction. Permanent TSB responded on Monday by confirming that no formal offer has been made, noting that Axis held just €100 of assets as of May 14th, the end of its financial year, according to financial accounts filed with the Companies Registration Office.
Bawag Takeover Progresses Toward October Court Hearing
Permanent TSB remains 57.5 per cent Government-owned and is advancing toward a High Court sanctioning hearing scheduled for October 27th under a scheme of arrangement. The bank secured 91.3 per cent support for the Bawag transaction at an extraordinary general meeting in late July, driven primarily by the State’s stake. The bank’s board stated on Monday that it is focused on delivering value and certainty to shareholders and is working with Bawag to satisfy remaining conditions. Meanwhile, Denis McGoldrick, an analyst with Goodbody, noted that while the Axis announcement reduces the perception that the Bawag deal is a foregone conclusion, investors still view Bawag’s agreed transaction as offering the greatest certainty until Axis demonstrates a credible funding solution.
Minority investors vote against Bawag acquisition
Approximately 36 per cent of minority investors voted against the Bawag acquisition at the July meeting. Axis Capital previously urged minority shareholders to oppose the planned sale and attempted to reopen the formal sale process so all credible bidders could participate, following an earlier underbid by New York private equity firm Centerbridge. John Cronin, founder of SeaPoint Insights, suggested that resistant minority shareholders might attempt to apply for an adjournment of the October court hearing until the position of Axis Capital becomes clearer. Shares in Permanent TSB rose 1 per cent to €3 in early trading on Monday, reflecting investor reaction to the developments.
Frequently Asked Questions About the Permanent TSB Takeover
What price did Axis Capital propose for Permanent TSB?
Axis Capital indicated it was considering a cash offer of €3.20 per share, which values the bank at approximately €1.74 billion.
How does the Axis proposal compare to the Bawag agreement?
The Axis figure is 7.7 per cent higher than the €2.97 per share agreed upon with Austrian firm Bawag in April, though Axis has not yet secured funding.
What is the next legal step for the Bawag transaction?
The High Court is scheduled to hold a sanctioning hearing for the scheme of arrangement on October 27th.
What stake does the Irish Government hold in Permanent TSB?
The State owns 57.5 per cent of the bank, which helped secure 91.3 per cent shareholder backing for the Bawag takeover in July.