ST.JOHN’S, Antigua and Barbuda, July 18, 2019 (CMC) – The Antigua and Barbuda government says it is prepared to hold direct talks with Scotiabank, over the acquisition of its local branch, here — by a Trinidad and Tobago-based financial institution, Republic Financial Holdings Limited (RFHL) — after indicating that the buyer was seeking as much as “300 percent” more than the sale price.
Prime Minister, Gaston Browne, had indicated, earlier this month, that his administration had received “positive” feedback, to a proposal that would allow it to own at least 40 percent of the Scotiabank branch, which is being sold as part of a deal that comprises several branches in the Caribbean.
But speaking on a radio program, here, Browne said, RFHL had agreed, in principle, to the 40 percent shares for Antigua and Barbuda, noting “And when I say Antigua and Barbuda, (I mean) a consortium of banks or the banks and the government of Antigua and Barbuda”.
“However, we are not quite happy with the maths. You know they come with the sophisticated talks, so for example, the value that we understand the bank to have, they want to price the value of the bank at about 300 percent of its value, and we have said to them, we are not accepting that,” he explained.
Browne told radio listeners that his administration is prepared to “pay whatever you paid for it; that is going to be the value that we will accept”.
Last November, RFHL announced, in a release, that it was seeking to acquire Scotiabank operations in several Caribbean countries.
Antigua and Barbuda and Guyana had initially expressed reservations about the proposed acquisition, with the Antiguan government indicating that it would not be issuing a vesting order to facilitate the move.
The RFHL statement said that the banks being acquired are located in Guyana, St. Maarten, Anguilla, Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines.
It said that the purchase price is US$123 million, which represents US$25 million consideration for total shareholding of Scotiabank Anguilla Limited; and a premium of US$98 million over net asset value, for operations in the remaining eight countries.
Antigua and Barbuda has said that it wants assurances that local banks will be given priority to purchase Scotiabank’s operations on the island and that local persons’ investments and savings will be protected.
Browne told radio listeners that if RHFL is prepared to accept the offer of the Antigua and Barbuda government, paying “whatever they pay Scotiabank Canada for the bank…then I think we definitely have a deal.
“If they do not, then this matter becomes a situation where we say, you know what, we are not having any deal with you. We will go and buy the bank ourselves, we will go and talk to Scotiabank ourselves,” the prime minister said.