On 8 Sep. 2021, Nordax Bank AB (publ) (Nordax) announced that it had reached its revised minimum acceptance condition of 66.67% with respect to its voluntary cash offer to acquire the outstanding share capital in Bank Norwegian ASA. As of the announcement Nordax had received acceptances of 66.76%. We note that the Government Pension Fund Norway (Folketrygdfondet), the second-largest owner in Bank Norwegian at 8.7%, has indicated that it will not accept the offer. Regardless, Nordax still aims to achieve its original minimum acceptance level of at least 90% share ownership by 24 Sep. 2021, the revised deadline for the offer period.
Regulatory approval is the largest remaining hurdle. While the Norwegian FSA has approved the sale of Bank Norwegian, Nordax is awaiting approval from the Swedish FSA and competition authorities. Assuming these approvals are granted, the terms of the transaction and details of the capital position and composition of the combined entity will become clearer.
Nordic Credit Rating assigned a 'BBB' long-term issuer rating to Nordax on 29 Jun. 2021. The outlook on the rating is stable and reflects the ongoing attempt to acquire Bank Norwegian. The prospective transaction would create the most diverse niche bank in the Nordic market and expand the combined entity's geographic and product footprint. However, ownership details and capital projections remain unclear and, in our view, Bank Norwegian's weaker asset quality metrics could offset improvements in product and geographic diversification for the combined bank.
We will continue to monitor the transaction as details emerge.
This commentary does not constitute a rating action.
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