Doesn't look too promising:
Peru's Banco Wiese Shares at Near 6-Year Low on Takeover
Lima, May 27 (Bloomberg) -- Banco Wiese Ltdo, Peru's second largest bank, sank to near six-year lows on the Lima stock exchange on shareholders concern that a forthcoming takeover by Banco de Lima Sudameris could leave them shortchanged.
The bank's common shares fell as much as 5 percent to 0.96 soles in Lima. That's the lowest price since the third quarter of 1993, according to the company. Banco Weise's American depositary receipt, which began trading in 1994, fell 9.1 percent to an all- time low of $1.25.
Investors are concerned because full details of the takeover have not been worked out.
''We still don't know the final numbers,'' said Gonzalo de la Puente, Wiese's general manager, referring to the stake each company will hold in the new bank. ''We are finishing a due diligence of both institutions.''
Banco Wiese, beset by weak profits and rising past-due loans, has plunged 58 percent on the stock market since the takeover announcement Feb. 17. The company was tapped to get a 47 percent stake in return for assets, however both banks have said the stake may be lowered.
''It's a difficult time for a merger. The possibility that there are adjustments is reasonable,'' said de la Puente.
Wiese's past-due loan rate shot to 13.75 percent of total loans on April 15, the highest ratio among Peru's top banks , according to the superintendent of banking and insurance. The ratio at the same time last year was 6.28 percent.
There is little sign of an immediate recovery, de la Puente said.
Sudameris, in addition to its assets, planned to inject at least $130 million into the new bank to gain a 53 percent majority stake.
De la Puente said other issues to be worked out include the composition of the new board of directors. The two banks are expected to conclude negotiations in coming days.
May/27/ 99 13:40 |
