National Bank of Greece, Healthy Enough for M&A (NBG)

National Bank of Greece SA (NYSE: NBG) is doing something odd.  It is trying to make an acquisition.  It was not that long ago that there were serious worries about NBG’s future.  Now, NBG has made a friendly stock-for-stock offer to local Alpha Bank to acquire it.

NBG said the terms call for Alpha holders to receive 8 new NBG shares for each 11 outstanding Alpha shares, roughly a 23% gain to yesterday’s close in Athens.  The Athens Stock exchange temporarily suspended trading in shares of both banks, but the news in Athens caused a local market rally of almost 3%.

To imagine that NBG is strong enough to acquire another bank might seem like a tough sell.  It was just in late-2010 that the PIIGS were trying to recover from a near catastrophe that actually threatened the Eurozone.  Shares are up 8.7% at $2.26 and the 52-week range is $1.48 to $4.50, but this was a $10.00 stock in 2008.

JON C. OGG