Banking, finance, and taxes
Tender Offer Drives Interest in National Bank of Greece
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National Bank of Greece S.A. (NYSE: NBG) had a lot of investors looking at Web-based quoting systems confused this week. The huge jump in share price was based on the equivalent of a 1:10 reverse stock split. At issue is that NBG has been arranging financing to bolster its capital levels so that it is not considered a defunct bank from a country that nearly imploded as well. Now shares are trading higher for real on Friday.
ADRs in New York trading have opened much higher and are currently up about 18% at $8.30, against what is an adjusted 52-week trading range of $5.64 to $32.50. The driving force behind today’s price jump is that NBG has launched a tender offer to repurchase its ADS preference shares listed in the U.S. for a total of $281 million.
We found the SEC filing, which shows all the details.
As a reminder, the bank also has a preferred share listing in the United States. An article on Reuters said, “The bank is offering to buy back up to 22.5 million American Depository Shares out of the 25 million outstanding for $12.50 each, at a 50 percent discount to their nominal value… ”
Tender offers are often accomplished only in past because many holders tender their shares above and beyond the amount that a company is willing to (or able to) accept. In those cases, usually investors get some sort of prorated transaction amounts. In the past when we saw this from U.S. regional and community banks, the common shares rarely traded at or above the tender offering price on the open market trading.
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