On Monday 10 July, the European Commission approved the planned acquisition of the Portuguese bank Novo Banco S.A. by the American investment fund Lone Star Funds, judging it compliant with the EU mergers Regulation.
The institution found that the planned acquisition would not hinder competition on the Portuguese banking market, as the two companies are active in different areas. Novo Banco is a commercial and retail bank, whilst Lone Star is a private investment fund active mainly in the fields of real estate and credit.
Novo Banco was created as part of the bailout, in August 2014, of the bank Banco Espirito Santo S.A (see EUROPE 11138), in the form of a 'bridge bank'. The Portuguese State undertook at the time to sell Novo Banco at a later date.
The sale of the Portuguese bank must, however, be approved by the European Commission under the State aid rules. The Commission is therefore currently in touch with the Portuguese authorities, to examine the restructuring plan for Novo Banco, which aims to allow a return to long-term viability for the bank. (Original version in French by Lucas Tripoteau)