Japanese financial group SBI Holdings said on Thursday that it has made an unsolicited offer for Shinsei Bank, which would see it increase its holding in the rival lender to 48%.
In a statement SBI Holdings said that after evaluating Shinsei’s core businesses, in particular its card loan and consumer finance segments, a tie-up would enhance the corporate value of both firms.
This view was backed by analysts at Jefferies: “If SBI HD takes 48% of Shinsei, we think that would be positive for SBI. ...SBI Group would gain a strong consumer finance franchise, with which the group could cross-sell the products in its network, which would contribute to Shinsei’s profits,” the bank said in a note.
SBI share rise on news
Shinsei itself remained tight lipped on the offer, in a statement the bank simply commented that it had not received any prior notice from SBI Holdings, and would announce its response after analysing the bid.
According to Nikkei Asia, SBI Holdings is keen on the deal because it wants to boost earnings at the eight regional banks Shinsei has capital ties with. The combined size of Shinsei’s groups makes its the tenth largest bank in Japan by size of assets.
SBI rose 7.1% while Shinsei Bank was untraded with a glut of buy orders at its daily limit price, which was 20.8% above Thursday’s close according to Reuters.