ING Direct USA Likely Too Big For PE

The sale of ING Direct USA is getting a lot of press.

Unfortunately, PE firms will probably not be interested in the online bank.

ING Group has confirmed that it is looking to sell the U.S. online division. Potential bidders include Citigroup and CIT Group, according to press reports. Deutsche Bank is advising on the sale.

Buyout shops likely won’t be interested in ING Direct USA, because it’s just too big, two sources say. A sale of the company could fetch $10 billion, the New York Post said.

ING Direct is know for the bright orange ball that is its logo (in New York, the ING cafe is one of the few places I know to get Peet’s coffee). ING is looking to sell its online banking business to repay Dutch state aid, my compadres at Thomson Reuters say.

ING’s U.S. banking unit had $77.7 billion in deposits at the end of 2010, which include $69.9 billion in money market deposit accounts, Bloomberg said. Because of these deposits, any buyer would likely have to be a bank, one PE source says. Buyout shops won’t be interested if ING Direct USA is sold on a standalone basis, a banking source says.

BankUnited or IndyMac may take a look at ING Direct but will likely not bid for it, the PE exec says. BankUnited is owned by WL Ross & Co. Carlyle and the Blackstone Group. An investor group, which includes Dune Capital Management and J.C. Flowers, owns IndyMac.

ING Direct USA is “more likely to go to a large domestic institution that doesn’t have a substantial online presence and wants to use this as a springboard,” the PE source says.