Eurobank, Greece's third-largest lender, is holding talks exclusively with US fund manager Pimco on the sale of its Financial Planning Services (FPS) unit, sources tell Business Daily, ruling out negotiations with any other potential buyer.
The deal relates to Eurobank's FPS unit, the lender's loan recovery business, and includes its Cairo portfolio of sour debt worth 7.4 billion euros.
Eurobank officials say negotiations are continuing exclusively with Pimco on the FPS sale and that talks are expected to very soon reach a positive outcome.
Delays to the sale were underlined in a story published by Reuters last week, while Business Daily had highlighted recently that talks have been extended until the end of October.
According to Reuters, the FPS had also drawn interest from an investment consortium consisting of U.S. activist fund Elliott, U.S. buyout fund Bain and Italian credit management group Cerved. Additionally, Italy’s biggest bad-loan specialist, doValue, made a preliminary bid this year but failed to enter exclusive talks.
Delays in negotiations have raised concerns about the outcome of deal, given that the completion of the securitization process of the Cairo Project and the FPS sale are a key part of the ambitious plan set by Eurobank to improve the health of its balance sheet.
Pimco and Eurobank have stumbled on the selling price of the FPS unit, sources say, while the US company has some doubts about the recovery rates of mortgages, citing recent cases.