Banca Transilvania signs competitor takeover and goes head to head with market leader BCR

Romanian lender Banca Transilvania has reached an agreement with Greek group Eurobank to acquire its subsidiaries in Romania. The deal targets local lender Bancpost, consumer loans firm ERB Retail Services IFN and leasing company ERB Leasing IFN. Banca Transilvania and Bancpost have a combined market share of some 16% of the total banking assets in Romania. Once the deal is completed, in the second quarter of next year, Banca Transilvania will get very close to BCR, the leader of the local banking sector. “The acquisition of Bancpost represents a value accretive opportunity for Banca Transilvania that will be maximized through the integration of the two banks. The acquisition will complement BT’s organic growth strategy so that we may further strengthen and consolidate our market position. We are prepared to responsibly adapt to the new dimension of Banca Transilvania, to a new chapter,” said Horia Ciorcila, Chairman of Banca Transilvania’s Board of Directors. He is also one of the bank’s founders and its biggest individual shareholder, holding close to 5% of the group’s shares. “With the divestment of Bancpost and its affiliates, Eurobank fulfils the last outstanding divestment obligation under its restructuring plan as approved by the European Commission with a capital accretive transaction,” said Stavros Ioannou, Deputy CEO of Eurobank. The two groups haven't disclosed the value of this deal. Banca Transilvania could pay between EUR 230 million and EUR 250 million for the Bancpost takeover, according to local mergers&acquisitions journal Mirsanu.ro. Barclays acted as a sole financial advisor to Banca Transilvania in this transaction. PeliFilip provided legal advice and Deloitte provided financial advice on certain accounting and diligence matters. Mediobanca and HSBC Bank acted as financial advisors to Eurobank in connection with the transaction and Shearman & Sterling and Schoenherr si Asociatii provided legal advice. Banca Transilvania and Bancpost will continue to carry out their activity independently until Romania’s National Bank (BNR) and the Competition Council give their OK for the transaction, which is expected in the following months. Once the acquisition is completed, Banca Transilvania will start integrating Bancpost into its own structure. With a market share above 13% and total assets in amount of RON 54.9 billion (EUR 11.9 billion), Banca Transilvania is the second largest bank in Romania. BT has over 7,000 employees, 2.2 million clients and approximately 500 units. The story of BT, one of the strongest Romanian brands and the first bank in Romania listed on the Bucharest Stock Exchange, started almost 24 years ago, in Cluj-Napoca, with a team of 13 people. Bancpost is the 9th bank in Romania, with a market share of almost 3% and total assets amounting to RON 11.6 billion (EUR 2.5 billion). Bancpost employs over 2,000 people through the network of approximately 150 units, serving more than 1 million clients. This is the second big acquisition Banca Transilvania undertakes after the Volksbank Romania takeover, a transaction that helped it make the leap from third to second in the local banks’ ranking.