VIENNA, July 29 London-based investment group
Millhouse Capital said it was ready in principle to pay 500
million euros ($672 million) for nationalised Austrian lender
Hypo Alpe Adria's Balkans network, raising the stakes
in the sale process.
Millhouse, owned by German businessman Ralf Dodt, also said
on Tuesday it could help protect Austrian taxpayers by providing
1 billion euros in guarantees for loans Hypo had made, and that
it intended to keep the Balkans business intact.
Hypo, which Austria had to nationalise in 2009 after a
decade of breakneck expansion at home and in former Yugoslavia,
is selling the Balkan network, its prime asset, while hiving off
toxic assets into a bad bank.
Sources familiar with the process said earlier this month,
before Millhouse made its bid, that the two front-runners for
the assets were Advent International, in partnership with the
European Bank for Reconstruction and Development and a
group of Bulgarian investors headed by airline and property
owner Denis Barekov and backed by Russian financial group VTB
Millhouse said last week that it abandoned plans to try to
join the Bulgarian consortium due to "insurmountable
difficulties with Barekov".
At least one other bidder, Russian businessman Igor Kim's
Expobank, has bid for the whole Balkans network, three sources
familiar with the process have said.
"Under certain circumstances we are willing to pay the book
value of the bank of 500 million euros," a Millhouse spokesman
said in an email on Tuesday, not specifying which conditions it
sought for this. Millhouse had earlier offered 200 million
euros, he added.
"It is not in our intention to break the bank in separate
parts. We want to invest in these countries where the bank is
active," the spokesman said.
Hypo's Balkan network, comprising six banks and three
leasing operations in Serbia, Croatia, Bosnia, Slovenia and
Montenegro, had assets of 8.6 billion euros at the end of 2013
but a book value of only 500 million after a series of
The business has lost value while Austrian politicians
wrangled over what to do with the rest of the bank, which has so
far received 5.5 billion euros in state aid.
The finance ministry declined to comment on Tuesday, saying
only that Hypo was handling the sale and that the government
wanted a quick deal that spared taxpayers as much as possible.
Hypo officials were not immediately available for comment.
Finance Minister Michael Spindelegger told parliament this
month that seven bidders were in the race for the Balkans
business. This included bidders for just parts of the
Deutsche Bank is advising on the sale.
($1 = 0.7444 Euros)
(Reporting by Georgina Prodhan and Michael Shields)