Bank of Ireland in Talks with PE Firms

The Bank of Ireland is in “advanced talks” with U.S. buyout firms, Reuters reported, citing a story in the Sunday Business Post. The bank is looking to raise 4.2 billion euros ($6 billion), and is said to be in talks with firms including Texas Pacific Group.

(Reuters) – Bank of Ireland is understood to be in advanced talks with US private equity investors interested in taking a stake in the lender which needs to raise 4.2 billion euros ($6.0 billion) in fresh capital, the Sunday Business Post said.

The newspaper, without quoting any sources, said the talks had advanced significantly in the past week and that the government had committed to selling a significant amount of its shares after a rights issue next month.

The bank, in which the state has a 36 percent stake, agreed a potential government stock placing of up to 15 percent on Saturday and market sources told Reuters the state likely had private investors lined up to take it on instead.

The Sunday Business Post said the bank was understood to have held discussions with a number of groups, including Texas Pacific Group, run by Ryanair backer and chairman David Bondermann.

Nobody from Bank of Ireland was immediately available for comment. Texas Pacific was not immediately available to comment.

The bank has said its in active talks with private capital and that the potential placing was agreed to facilitate such talks.

The newspaper said private equity investors were believed to be generally more confident in Irish banks following a more thorough set of stress tests in March.

However, it said any fallout from the Greek crisis could jeopardise a deal and that Irish banks’ reliance on the European Central Bank for funding was also a key issue.

Irish banks, shut out of interbank lending markets, had borrowed 102 billion euros from the ECB and 54 billion from Ireland’s own central bank at the end of May. (Reporting by Padraic Halpin. Editing by Jane Merriman)