Moneta shareholders OK merger with PPF's banking arm

Prague, Dec 20 (CTK) - Moneta Money Bank shareholders today approved a merger with the PPF group's banking arm as well as an increase in Moneta's registered capital through a subscription of new shares to fund the transaction, Moneta spokeswoman Zuzana Filipova told CTK.

The shareholders also approved the distribution of dividends from previous years' retained earnings in the total amount of Kc1.53bn, which corresponds to Kc3 per share.

Moneta will acquire 100 percent of PPF's Air Bank Group for Kc25.90bn. Eighty percent of the price will be covered from the money Moneta will generate from its current shareholders for the subscription of 255,500,555 new shares, and the remaining 20 percent will be covered from Moneta's excess capital.

The Air Bank Group comprises Air Bank, consumer loan provider Home Credit's Czech and Slovak operations, and Benxy, which operates peer-to-peer loan service Zonky

A total of 77.85 percent of Moneta shareholders voted in favour of the merger, while 21.93 percent were against it.

Moneta believes that the acquisition of the Air Bank Group will create a strong banking champion for sole traders and retail clients on the Czech banking market, board chairman Tomas Spurny said.

Moneta and Air Bank Group complement each other, PPF shareholder and Home Credit head Jean-Pascal Duvieusart said. He also confirmed PPF's intention to keep the merged bank on the Prague bourse.

The subscription of new shares will have two rounds. In the first round, the new shares would be offered to all Moneta shareholders at Kc82 per share, with every two existing Moneta shares enabling their owner to subscribe for one new share. If any new shares remain untaken after the first round, all such shares would be offered to all Moneta shareholders at Kc90 per share in the second round.

In the event that Moneta shareholders do not exercise their pre-emptive rights, PPF has pledged to subscribe for all the remaining new shares in the second round.

The purchase price is to be paid upon the merger closing, which has been preliminarily scheduled for July 2022 but depends on the obtaining of regulatory approvals.

The acquisition has yet to be approved by the Czech National Bank and the National Bank of Slovakia and it also needs antitrust approval from the European Commission.

Moneta shareholders approved the agreement on the merger in June but they rejected the proposed model of its funding then.

PPF is Moneta's biggest shareholder with 29.94 percent of shares.

The merger is expected to give rise to the third largest bank on the Czech market after Ceska sporitelna and CSOB in terms of client numbers.

In terms of the balance of assets, the new entity should be the sixth largest in Czechia, Cyrrus analyst Tomas Pfeiler said.

Total assets of the merged entity will amount to Kc479bn. If the fast organic growth continues, Moneta could soon get ahead of Raiffeisenbank and UniCredit, whose assets exceed Kc500Bn, Pfeiler said.

Moneta Money Bank previously operated under the name GE Money Bank. It was renamed in 2016 in relation to its listing on the Prague bourse. It is one of the biggest listings traded there.

Before the Moneta general meeting this morning, a dozen activists protested in front of its venue, trying to persuade shareholders not to vote in favour of the merger.

The merger of Moneta with PPF, and potentially with coal tycoon Pavel Tykac, would be devastating for both Moneta and the environment, initiative Zastavme spinave prachy spokesman Petr Doubravsky said.

Tykac owns over 6 percent of Moneta.

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