As told by Spanish bank Popular, with forthcoming profits and synergies, they will be very well able to pay large amount of premium for buying their rival company Pastor. Meanwhile, it will also be concentrating on defending its assets with changeable bond issue.
Spanish bank popular is the fifth largest bank of Spain. According to its chairman, the company is ready to pay a premium of 31% for buying Pastor, and this is something reasonable because with this they will surely get the control of the Galician-based bank.
As told by Angel Ron, while presenting the deal to analysts on Monday: "(We paid a premium for Pastor) based on its earnings generation capacity and because the deal also gives us control of the bank".
Popular expects to produce 15% more profit on around 1.3 billion Euros ($1.8 billion) investment, which it would further put into for buying Pastor by 2015. Other than this, popular also expects to cut down the cost by 150 million till then.
However, the analysts are still doubtful about the price paid by Popular, and they even doubt the timings that the bank has mentioned for this deal.
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