Guo Guangchang, the head of Chinese company Fosun, will only come to Portugal if he is assured the Novo Banco deal will go through and that he will be the new owner.
The current negotiations are said to be ‘technical’ and involve Lingjiang Xu, head of Fosun in Europe with advice from Magalhães Correia from Fidelidade, and experts from Morgan Stanley and KPMG representing the Chinese group.
Negotiations between the Bank of Portugal and Fosun should be completed by the end of next week.
The Bank of Portugal governor Carlos Costa wants get Novo Banco sold off before the general election on October 4th.
The president of Fosun, Guo Guangchang, plans to visit Lisbon next week, but this depends on the progress of the talks that his aides are involved in.
Fosun management is adamant that they will not raise the offer price and in the wake of a damning PwC auditors report to Novo Banco’s half year figures, Fosun may wish to lower the offer.
The legal issues surrounding Novo Banco in terms of paying back the ripped-off BES depositors continues to affect Novo Banco’s profile and Fosun has made it clear that it is not up to them to repay these depositors should the deal to buy the bank go through
Given the many uncertainties and doubts on both sides, the Bank of Portugal and the government may opt for a postponement of the sale, a scenario that is looking increasingly probable.
Comments
At the moment Novo Banco is being offered at about 3 times what Goldman Sachs want back. Bundle in the other lesados and their legal bills and before long, with falling value, it may be simpler and cheaper to just hand it to them to dismantle.