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Lone Star considering revised offer for the Bank of Cyprus

The Bank of Cyprus has posted an after-tax profit of €19 million for the third quarter of 2021, with after-tax profit reaching €20 million for the first nine months of the year, it announced on Tuesday.

Private equity firm Lone Star, in a statement issued on Tuesday to the London Stock Exchange, said that it is considering its options in terms of submitting a revised offer for the acquisition of the Bank of Cyprus.

The Bank of Cyprus’ board of directors has already unanimously and unequivocally rejected three unsolicited, conditional, non-binding proposals by the US private equity firm, with the last proposal offering €1.51 per share for the bank.

“Following the rejection of the offer, Lone Star is considering its options in relation to the possibility of submitting a revised offer to the Board of the Bank of Cyprus,” the firm said in their statement, before adding that “Lone Star recognises the strategic importance of the company in Cyprus”.

In addition, the firm said that “as a global investor with a strong track record of investments in the financial sector, including Germany’s IKB Deutsche Industriebank AG and Portugal’s Novo Banco SA, Lone Star takes seriously the preservation of strategic financial institutions as well as the advancement of businesses under its ownership her”.

Lone Star also said that it has not come to a final decision in regards to the submission of a revised and final offer to the Board of Bank of Cyprus, however, it clarified that any revised offer proposal submitted will be for the acquisition of Bank of Cyprus through a scheme of arrangement based on Irish law, and not on the basis of a takeover proposal as specified in the relevant Cypriot law of 2007.

Furthermore, the firm said that it has been in communication with the Cyprus Securities and Exchange Commission (CySEC), confirming that a potential takeover of the Bank of Cyprus will be subject exclusively to the jurisdiction of the Irish Takeover Panel, under Irish takeover rules.

On August 25, CySEC chairman George Theocharides said that the commission was closely monitoring the non-binding takeover offers submitted by Lone Star.

“CySEC is in consultation with both the Bank of Cyprus and the corresponding supervisory authority in Ireland, the Irish Takeover Panel, the country in which the Bank of Cyprus is registered, to see that the provisions of the legislation of both Cyprus and Ireland are being respected,” Theocharides said at the time.

It should be noted that under Irish takeover rules, Lone Star is required by no later than 17:00 (Irish time) on September 30, to either announce its intention to submit its final offer or to notify that it does not intend to do so. This deadline may be extended by the Irish Takeover Panel.

“There is no certainty that any formal takeover bid for Bank of Cyprus will be made or the terms on which any bid will be made public,” Lone Star concluded.

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