The mentioned acquisition was concluded at RSD 4350 per share (EBRD) and RSD 4508 per share (IFC). To put things into a perspective, the mentioned transaction translates to a P/B 1 and a P/E of 8.2 (for RSD 4350 per share) and 8.5 (RSD 4508 per share).

Yesterday, the Republic of Serbia acquired an additional 34% stake in Komercijalna Banka from EBRD and IFC. The mentioned acquisition was concluded at RSD 4350 per share (EBRD) and RSD 4508 per share (IFC). To put things into a perspective, the mentioned transaction translates to a P/B 1 and a P/E of 8.2 (for RSD 4350) and 8.5 (RSD 4508). Following the mentioned transactions, the Republic of Serbia will own 83.2% of the bank, which will enable the privatization of the Bank under the ongoing privatization process. By acquiring the mentioned shares, the state has fulfilled its obligation (put option) as part of the current sale of the bank, which was defined in 2006.

As a reminder, the transaction follows the acquisition by the Republic of Serbia of 6.89% of ordinary shares from Swedfund and DEG which was completed in June 2019.

Such news came less than a week before announced opening of the binding bids, which will occur on 2 December 2019. However, note that there is still possibility that the privatization of the bank will be called off.

From the State’s point of view (under the assumption of the privatization going through), it is very possible that the they will record a loss on the mentioned sale, as it seems unlikely that any of the acquirers will offer a full book for the bank. To put things into a perspective, Komercijalna Banka’s shares are currently traded at a P/B of 0.76.

To read more about Komercijalna Banka click here.