Quick-dry ink seals Citadele deal

The Privatization Agency (PA) announced Wednesday that the sale contract for the 75% state-owned stock in commercial bank Citadele was signed, thus transferring ownership to an investor group that includes Ripplewood Advisors and retains the European Bank for Reconstruction and Development (EBRD) holding its 25% share.

The sale-price for the stock was finalized at €74m and provides for the investors jointly with the EBRD to invest an additional €10m. The transaction will only see full closure in the first-quarter of 2015 when various supervisory financial institutions make certified approval of the deal, which can still fluctuate in value according to the bank’s continued performance until the end of 2014.

According to reports, Ripplewood plans on controlling 22.4% of the stock, with 52.6% to other investors yet to be named as co-shareholders.

Ripplewood founder Tim Collins, after putting his signature next to newly-appointed civil servant signatories on the Latvian government’s part, said the investors have long-term plans and “look with enthusiasm to their investment in Citadele – a financial establishment with professional leadership and stable position in the Latvian market.”

PA board chairman Vladimirs Loginovs said the consortium “met our established criteria for financial stability, good reputation and business growth strategy, so that the state can end its support provisions to the bank in the knowledge it will remain among the leading banks in Latvia.”

EBRD vice-president Phillip Benet said it was the correct choice for the bank and the nation and that he was satisfied with Ripplewood’s assurances. He added that with EBRD maintaining its quarter-share of the bank it would remain a critically important player in the stability of Latvia’s economic growth, which it remains ready to support.

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