Halkbank offers 10 million euros for Čačanska Banka

Negotiations are nearing completion, and a contract for purchase of 76.74% of the shares of Čačanska Banka is expected to be signed on 25 February. The value of this transaction amounts to a little over ten million euros.

Minister of Trade and Telecommunications Rasim Ljajić has confirmed to Blic that negotiations are under way, but refused to talk about the details of the transaction.

“One of the biggest Turkish banks returned to the table to negotiate taking over a majority of the shares of Čačanska Banka. It would be very good for Serbia if this transaction is successful, as the arrival of Halkbank would be a signal for Turkish businessmen to invest more in Serbia”,said Ljajić.

We recall that Halkbank was the only one to answer the Deposit Insurance Agency’s public call for the sale of shares of Čačanska Banka at the end of 2013. The negotiations lasted almost a year and just when it seemed that the Turks would take over the bank, it was announced in December 2014 that they had given up. Halkbank said that they could not agree on a price.

According to claims expressed to Blic from a government source whose representatives led the negotiations together with the EBRD and IFC, Halkbank offered six million euros for a majority stake in Čačanska Banka following the public call. This price was too low in the opinion of the owners. The offer was later raised to ten million euros and although there were indications that the agreement was approaching a conclusion, Halkbank announced that it was withdrawing.

It seems that now is the right time for selling Čačanska Banka. Like many other state-owned banks, Čačanska Banka has also had a problem with non-performing loans and a fall in value of the bank's capital. Among those who have taken a loan from Čačanska Banka and never repaid it is Miroslav Bogićević, who is an inevitable problem in any bank. His company Farmakom took a loan worth five million euros from Čačanska Banka and never returned it.

Halkbank opened a representative office in Belgrade in 2013 and has been expanding its business across the region since then. For example, their work is highly developed in Macedonia: they currently hold approximately 60% of loans to small businesses. But they have also had serious problems in the last two years. A long-time General Manager of the bank was arrested in late 2013 on corruption charges, which threatened the bank's reputation. The new management that was appointed in the spring of 2014, however, regained its business and reputation.

The omniscient market

The value of the shares of Čačanska Banka started rising before the weekend. In just one day their price increased from 8,000 to 8,500 dinars. It is presumed that their price will continue to rise as the announced takeover approaches.

Translation provided by: www.halifax-translation.com