China's Legend, buyout funds preparing final bids for Allfunds Bank: sources

[LONDON] Chinese investment firm Legend Holdings and three groups of private equity funds are putting the finishing touches to rival bids for Allfunds Bank, a deal worth close to 2 billion euros (S$3 billion), sources close to the matter told Reuters.

Santander Asset Management and Intesa Sanpaolo, which own 50 per cent each of Allfunds Bank, a Madrid-based mutual fund platform, have agreed to push back the deadline for the binding offers to March 1 from a previous cut-off date of Feb 27, giving prospective bidders extra time to finalise their offers, the sources said.

Banco Santander, which controls Santander Asset Management, declined to comment, while Intesa was not immediately available for comment.

The deal, which is expected to wrap up by the end of March, has drawn interest from a series of US and European private equity firms which have teamed up with some cash-rich sovereign wealth funds and Canadian pension funds.

A consortium of Bain Capital, Advent and Singapore's state investor Temasek is vying against two other private equity consortia led by Permira and Hellman & Friedman, respectively, the sources said, speaking on condition of anonymity as the matter is confidential.

Permira has formed an alliance with PSP Investments, one of Canada's biggest pension funds, while Hellman & Friedman is bidding in tandem with Singapore's sovereign wealth fund GIC, the sources said.

Advent, Bain Capital, Hellman & Friedman and PSP declined to comment, while Temasek, Permira and GIC were not immediately available for comment.

China's Legend Holdings, owner of computer giant Lenovo Group, is also keen to secure control of the business, which is regulated by the Bank of Spain and has more than 250 billion euros of assets under management.

If successful, Legend would clinch its first major European deal after securing a minority interest in Britain's Pension Insurance Corporation (PIC) last year.

However, Legend would need to pass the vetting of the Bank of Spain which will have the final word on Allfunds' new ownership structure, the sources said.

A spokeswoman at Legend had no immediate comment.

Allfunds could be valued at about 1.8 billion euros, fetching a multiple of roughly 15 times its pro-forma earnings before interest, tax, depreciation and amortisation (Ebitda) of 117 million euros, the sources said.

While its core earnings fell nearly 9 per cent last year to 98 million euros, it has benefited from some new contracts which have boosted its financial projections, they said.

Established in 2000 to provide access to the so-called open architecture investment funds market, Allfunds offers more than 50,000 funds and has an extensive network of more than 530 clients including commercial and private banks, fund managers and insurers.

REUTERS