PRAGUE, June 22 (Reuters) - MONETA Money Bank shareholders will vote on Tuesday on a $1.2 billion deal to buy the Czech lending assets of its biggest shareholder PPF and create a major challenger to the country’s biggest banks.
The proposed tie-up, which is still far from certain, is the second such attempt by Czech lender MONETA. A potential deal with the Czech Republic’s biggest investment group - which was founded in the 1990s by Czech billionaire Petr Kellner, who died in a helicopter crash in Alaska last March - fizzled out in 2019 when MONETA sought a lower valuation of PPF’s Air Bank.
PPF has built up a 29.9% stake in MONETA and is seeking majority control to gain a stronger foothold in a domestic market dominated by foreign owners.
But some shareholders and proxy advisers have criticised the deal, the two key elements of which will be voted on at a shareholder meeting starting at 0800 GMT on Tuesday.
The first vote is the acquisition of PPF’s Czech lender Air Bank, along with the Czech and Slovak units of global consumer lender Home Credit and peer-to-peer lender Benxy, for a price of 25.9 billion crowns ($1.2 billion).
Shareholders will also decide on the issuance of 291.4 million new shares at 80 crowns per share subscribed to PPF. The 23.3 billion crowns in proceeds will help to pay for the acquisition and PPF will increase its stake to 55.4% in the process, diluting other shareholders.
The combined group will target net profit of 8.5 billion crowns by 2024.
Fund group Petrus Advisers, which says it holds a more than 5% stake in MONETA that makes it the second-biggest shareholder, has said the deal undervalues MONETA and its economics were not attractive.
Investor advisory firms Glass Lewis and Institutional Shareholder Services have also said the price of the deal was high.
MONETA and PPF say the tie-up will create a champion in retail and small-business lending, with a combined customer base of 2.4 million, more than the country’s third-largest bank Komercni Banka, owned by France’s Societe Generale .
Belgian group KBC’s CSOB and Austrian bank Erste Group’s Ceska Sporitelna are the country’s biggest lenders. ($1 = 21.4890 Czech crowns)
Reporting by Jason Hovet Editing by David Goodman