Lone Star negotiates quid pro quo with Brussels
The Lone Star fund is negotiating new quid pro quo and agreements with the European Commission in order to acquire Novo Banco. An important point is the so-called 'side bank', worth 9 billion euros.
Negotiations between the Portuguese Government and Lone Star for the sale of Novo Banco are in full swing — the minister of Finance himself stated this Tuesday that NB‘s sale will be performed “within the next couple of weeks”. European authorities still need to give green light to the operation which will allow the State to continue being a minority shareholder in the bank — holding 25% equity–; yet, Lone Star is negotiating an exchange of concessions to acquire the bank.
The Government has made a number of agreements with Brussels to ensure the resolution of Novo Banco would take place — those agreements will now be renewed, concerning the administrators’ salaries, dividends’ distribution and a decrease in employers and branches. But ECO knows through sources close to the negotiations that there are still other quid pro quo Lone Star is trying to renegotiate with DGComp (Directorate General for Competition), namely the decrease rhythm of the so-called ‘side bank’ — the bank’s unprofitable assets worth nine billion euros.
DGComp wants to quickly decrease the size of the side bank to 7.5 billion, in which 2.5 billion real estate assets are included, but also restructuring funds, non-strategical operations and international operations. Lone Star, on the other hand, is trying to negotiate a slower decrease in order to have more time to sell those assets, in exchange of an agreement Brussels should appoint, although it is still unknown.
