EBS sale process passes latest deadline

THE sale process surrounding the EBS Building Society is unlikely to be completed until near the end of the year, despite yesterday’s latest deadline for bids from interested parties.

While no parties were commenting yesterday, the Friday deadline for second round bids for EBS isunderstood to have drawn attention from Irish Life & Permanent (IL&P) and three private equity groups in the form of Doughty Hanson (which owns Irish broadcaster TV3), Cardinal Asset Management and US giant JC Flowers.

The building society’s ultimate new ownership structure will be split between Government and one of the above parties. The process is likely to be whittled down to two parties before finally being completed around October or November.

IL&P has been bandied about as a potential buyer of EBS for some time now – the merging of its retail banking arm, Permanent TSB, with the building society having long-since been talked about as forming the bedrock of a so-called “third force” in Irish banking.

While it is understood that the financial services group is not a “shoe-in” to win the process; industry sources suggest that it will still be viewed as the definite favourite – partly due to its profile as an Irish buyer with no NAMA-related baggage, which could bolster the country’s banking network if successful in its bid.

Given the fact that EBS is also in need of nearly €900m in fresh capital before the end of the year, it is thought that less of that would have to come directly from the state if the co-owner was another bank, rather than a private equity house.

One commentator suggested, yesterday, that one of the private equity investors would only probably invest about €400m in EBS.

Meanwhile, AIB was yesterday playing down reports that Friday was a deadline day for bids for its 70% stake in Poland’s Bank Zachodni.

While it is strongly believed that Spain’s Santander and BNP Paribas of France are battling it out with Polish bank PKO for the asset, the Irish bank is sticking with its recent line that it is hoping to conclude its main overseas disposals by the end of next month.