The independent expert commissioned to evaluate Eurobank’s public offer for the remaining shares of Hellenic Bank has deemed the proposed exchange of €4.843 per share as fair and reasonable.
This assessment, based on the independent valuation report, concludes that “the proposed consideration to be paid by the offeror to the shareholders of the company in connection with the public offer is fair and reasonable from a financial perspective,” subject to the assumptions, reservations, and limitations detailed in the Independent Valuation Report.
“Taking into account these conclusions, the board agrees with and adopts the independent expert’s opinion that the proposed consideration ‘is fair and reasonable from a financial point of view’,” said Hellenic Bank’s board of directors.
In its deliberations, the board also took into account the comments from Eurobank on the public offer document regarding the proposed consideration and its calculation basis.
The proposed consideration, set at €4.843 per share, represents the highest price that Eurobank or its associates have paid for Hellenic Bank shares in the 12 months preceding the announcement of the public offer.
Hellenic Bank’s CEO, Michalis Louis, declared a conflict of interest due to his position on the executive board of the offeror, Eurobank, and therefore did not participate in the board’s discussions of the public offer document or the report.
In addition, no other board members declared any conflicts of interest.
The public offer is mandatory under the provisions of article 13(1) of the law, following Eurobank’s acquisition of 154,832,195 shares of Hellenic Bank at the rate of €4.843 per share on February 10 2025.
These shares were purchased from various entities including the Cyprus Union of Bank Employees (Etyk), the Cyprus Bank Employees Welfare Fund, Demetra Holdings Plc, and Logicom Services Limited.
The purpose of the public offer is for Eurobank to acquire the remaining 26,958,229 shares of Hellenic Bank, representing 6.53 per cent of its issued share capital.
The offer allows shareholders of Hellenic Bank the right to sell all or part of their shares in exchange for the proposed consideration.
However, if shareholders choose not to sell their shares during the public offer process, they will be required to sell them to the offeror when Eurobank exercises its right of compulsory acquisition.
Meanwhile, the board noted that the independent expert’s valuation reference ranges were calculated between €4.21 and €5.07 per share.
At the low end, this represents a 13.1 per cent reduction from the proposed consideration, while at the high end, it is 4.7 per cent above the offer price.
An additional scenario where Hellenic Bank would not distribute its excess distributable capital produced valuation ranges of €3.20 to €4.77 per share, indicating a potential 1.5 per cent to 33.9 per cent decrease from the proposed consideration.
What is more, Eurobank has stated that it does not intend to replace any members of the Hellenic Bank board of directors before the completion of the merger process between the company and Eurobank Cyprus Ltd, except to fill vacancies arising from the departure of any board members.
Furthermore, Eurobank has no plans to make significant changes to the current terms of employment for Hellenic Bank employees before the merger is finalised.
Any changes to employment policy will be reviewed post-merger.
The board also said that Eurobank does not currently intend to alter the company’s activities significantly, except possibly to expand certain operations.
Therefore, the board does not foresee any major impact on the company’s operations or the locations where they are conducted, provided this intention remains unchanged.
However, it is noted that Eurobank plans to merge the activities of Eurobank Cyprus Ltd with those of Hellenic Bank after the latter’s shares are delisted from the Cyprus Stock Exchange.
The board also advised shareholders to seek their own professional advice regarding the provisions of the law and their decision on whether to accept the public offer.
In addition, the board stressed that the report is intended to fulfil its obligations under article 33(2) of the law and is not a recommendation to shareholders on whether they should participate in the public offer.
Therefore, the final decision rests with the shareholders themselves.
The acceptance period for the public offer is set to close on April 9, 2025, at 14:30.
Eurobank has indicated its intention to exercise its right of compulsory acquisition to acquire all outstanding shares in Hellenic Bank.
