Blackstone closes €1 billion acquisition of Baltic bank Luminor

The US private equity giant Blackstone Group has finalized its €1 billion acquisition of a 60 percent stake in the Baltic bank Luminor.

A Blackstone-led consortium has become Luminor's majority shareholder after the deal was cleared by all relevant supervisory authorities.

The bank's current owners, Nordea Bank Abp and DNB BANK ASA, will each retain a 20 percent equity stake in Luminor.

The consortium, which includes a wholly-owned subsidiary of the Abu Dhabi Investment Authority, as well as other co-investors, has now completed the transaction having received the relevant approvals.

Nordea and DNB will continue to support the bank with long term funding, expertise and on-going representation on the board of directors. Blackstone has agreed with Nordea to purchase their remaining 20 percent stake over the coming years.

"We are excited by the long-term partnership with management, Nordea and DNB and look forward to working together to create a stronger platform to further economic growth in the Baltics. We will continue to support local businesses and strongly believe that Luminor is well positioned to continue to lead the market as an independent provider of financial services," Nadim El Gabbani, senior managing director at Blackstone, said in a press release.

Nils Melngailis, chairman of the supervisory council of Luminor, said that the Baltic countries benefit from a strong macroeconomic climate and a stable operating environment, and are among the most dynamic economies in the European Union.

"This transaction represents one of the largest investments in Baltic history and I would like to acknowledge the efforts of the regulators in the approval process and our teams in completing the transaction. I look forward to our strategic partnership with Blackstone," Melngailis said.

Erkki Raasuke, CEO of Luminor, described Blackstone is an ideal partner for Luminor as it undertakes one of the most extensive corporate transformations in the Baltics.

"Their demonstrable track record in transformations, strong financial standing and network of global talent will support Luminor in growing as the largest local independent bank; a bank which will be dedicated to supporting sustainable growth of the Baltic region by providing long term commitment to businesses and individuals," Raasuke said.

Blackstone first announced its intention to acquire 60 percent of Luminor, a bank registered in Estonia, in September 2018. The European Commission gave its nod to the transaction in January. By now all remaining relevant approvals have been received from the European Central Bank and Baltic national regulators.

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