Advent starts preparations for IPO, sale of Addiko bank, say sources: Reuters

Private equity group Advent is starting preparations for an initial public offering or sale of its Vienna-based bank Addiko, which has a strong presence in the Balkans, people close to the matter said.

The buyout group is working with Goldman Sachs and Citi on an exit process, which will primarily focus on a potential stock market listing, while also allowing suitors to bid for the lender which emerged from the collapse of Hypo Alpe Adria.

Advent and Goldman Sachs declined to comment. Citi officials were not immediately available for comment.

One of the sources said Addiko has a book value of around 850 million euros ($985 million), adding that an IPO or sale could take place next year.

While, a potential valuation is unclear, European peers trade at an average of 0.85 times book value.

Potential investors are expected to closely watch the listing of Slovenia’s state-owned Nova Ljubljanska Banka (NLB), which announced its intention to float on Monday.
One other pointer may be last year’s listing of Austrian bank Bawag by Cerberus. It currently trades at book value.

Addiko is an Austrian bank holding company with operations in Slovenia, Croatia, Serbia, Montenegro and Bosnia-Herzegovina – a legacy of Hypo Alpe Adria’s aggressive expansion in the Balkans from the 1990s onwards.

Bavarian public-sector lender BayernLB bought half of Hypo for 1.6 billion euros in 2007, later taking a majority stake. Despite injecting cash into the struggling lender several times, it sold the bank to Austria for 1 euro two years later.

Hypo’s Balkan network was sold to Advent and the European Bank for Reconstruction and Development for about 200 million euros in 2014. Advent has turned Addiko into a digital challenger bank, which targets a return on equity of around 10 percent.