Only one of the three potential buyers of Novo Banco decided to raise its offer - Apollo Global Management's private equity divison.
At the close of the enhanced offer deadline last Friday, Novo Banco’s Stock da Cunha received only one enhanced offer for the good parts of collapsed BES.
The three bidders, Anbang and Fosun from China, and Apollo from the US, submitted their original offers on time. The Bank of Portugal, which is overseeing the sale process, accepted all three offers but asked that the companies' boards go away and think very hard about making higher bids.
If the top bid does not cover the €4.9 billion required to get the Bank of Portugal Governor, the Finance Minister and the Prime Minister off the hook, the sale of Novo Banco may be postponed although this would trouble Portuguese and international markets.
Finance Minister Maria Luís Albuquerque needs the Novo Banco sale money to balance the books this year and to surprise everyone by hitting the government’s ambitious deficit target.
The Bank of Portugal said over the weekend that all three of the foreign companies that got through to the final stage of bidding still are in the contest and that its staff will evaluate the proposals "over the coming weeks."
The decision on which bid will be the successful one must be made "by the end of August" according to the rules of engagement.
If the sale is postponed, this would be sensible for a variety of good reasons.
There is raft of looming litigation against Novo Banco and the Bank of Portugal who, claimants allege, managed by their actions to wipe out BES depositors' money in an in-branch investment scheme that was immoral, illegally sold and now ignored by the regulator which was meant to be regulating BES at the time.
It is more likely that the highest offer for Novo Banco will be accepted, with the government working immediately on surpressing negative commentary on the enormity of loss to the taxpayer.
