NLB lowers minimum acceptance threshold for Addiko takeover to above 50 percent

With the reduction of the minimum acceptance quota, NLB is following a move by RBI: After RBI lowered the minimum acceptance quota in its takeover offer for all Addiko shares from above 75 percent to more than 55 percent last week, Slovenian NLB also reduced its threshold from 75 percent to above 50 percent. The two competing bidders are thus considerably closer together on the central condition for the success of their offers than they were at the start of the takeover battle.

Both banks have been courting willing shareholders intensively for months, with shareholders able to switch between the offers. The current deadline runs until July 16 at 5:00 p.m., and NLB has filed a request with the Takeover Commission to extend the acceptance period. Should the deadline be extended, the final date by which RBI can definitively determine its success or failure will also be pushed back.

Neutrality of Addiko's management

At the end of June, the Management Board and the Supervisory Board of Addiko Bank withdrew their recommendation to accept the offer from Raiffeisen Bank International (RBI) and are now neutral toward the takeover offers. As a result, neither the management nor the controlling body of the target bank has expressed a preference for either of the two bids, placing the decision more firmly in the hands of the free shareholders.

In arithmetic terms, NLB can only cross the 50 percent hurdle if shareholders withdraw their commitments to the rival. An automatic switch is not provided for in the procedure; the bidder is therefore dependent on active withdrawals in order to raise its own acceptance quota above the relevant threshold.

RBI, which has already crossed the statutory 50 percent threshold for Addiko shares, thus currently enjoys greater acceptance among shareholders. With the lowered minimum acceptance quota, however, NLB is giving itself more room to maneuver in order to cross the threshold itself in the event of numerous withdrawals from RBI commitments.

What shareholders need to bear in mind

From the shareholders' perspective, the development means a simplification: the commitment to one offer is less final, and switching between the bidders remains possible in principle within the deadline. Which bank ultimately holds the majority in Addiko Bank therefore depends not only on the price offered, but also on the mobilizing capacity of the two bidders in the days remaining.

Should the Takeover Commission grant NLB's request for an extension of the deadline, the cards would be reshuffled. Until then, the deadline of July 16 at 5:00 p.m. applies, by which both sides and the shareholders are guided.

Deadline and possible extension

Market observers interpret the parallel threshold reductions as a sign that both institutions are competing for a broad shareholder base and would consider their offers successful even with less than three-quarters of the shares. The final decision on ownership and control at Addiko Bank therefore remains open until the expiry of the deadline or until any possible extension.