Legend Holdings launched a sale process for its 90% stake in Banque Internationale à Luxembourg, according to the Financial Times. Initial bids are due around the end of September. People familiar with the matter put the bank's potential valuation at about €2.5 billion or more, although discussions remain at an early stage and no transaction is certain.
The Chinese investment group is working with Goldman Sachs on the process. The Financial Times reported preliminary interest from institutions in Europe and the Middle East, with some potential buyers considering only parts of the business. Legend agreed in 2017 to buy the stake from Qatari-backed Precision Capital for €1.48 billion, a deal completed in 2018 that valued BIL at about €1.65 billion.
LUXEMBOURG KEPT ITS POSITION
Luxembourg's government owns the remaining 10% of BIL. Finance Minister Gilles Roth told RTL that the state would retain that holding. Roth said BIL was a systemic bank in Luxembourg and that the state would stand by it.
BIL was founded in 1856 and is Luxembourg's oldest private bank. It provides wealth management and corporate banking services.
BIDS WILL TEST BUYER INTEREST
The process comes amid increased M&A activity among European banks in recent years, the Financial Times reported. According to the FT, BIL may appeal to banks seeking to expand in wealth management, while some bidders may only be interested in parts of the bank.
The immediate milestone is the initial-bid deadline around the end of September.