BBVA, the Spanish bank, has launched a €2bn bid for the 50.15 per cent of Garanti, Turkey’s biggest bank by market capitalisation, that it does not already own, using funds from its own recent sale of US assets.
The acquisition price of TL25.7bn (€2.25bn) represents a 34 per cent premium on the average price of Garanti shares over the past six months and is BBVA’s most recent proposed use of funds from $11.6bn it netted from selling its US assets to PNC this year.
“The sale of the US subsidiary provides us with strategic optionality to, among other things, invest the excess capital in our main markets,” said Onur Genc, BBVA chief executive, who came originally from Garanti.
BBVA is carrying out a €3.5 share buyback plan of up to 10 per cent of its shares, one of the largest in Europe.
The Garanti purchase takes place against the slide in value of the Turkish lira, whose purchasing power in euros has tumbled to around a…