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CVC takes 15% stake in Philippines bank for $115m

  • Anita Davis
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CVC Capital Partners has taken a 15% stake in Philippine bank Rizal Commercial Banking Corporation (RCBC) for approximately 4.96 billion Philippine pesos ($115 million), which RCBC aims to use for future acquisitions of SME-sized banks in the Philippines, the bank announced.

According to a statement, CVC specifically acquired its 15% stake through the purchase of outstanding common stock via its Hexagon Investment Holdings Limited (HIHL). Under the terms of the agreement, RCBC and certain shareholders will sell 171 million common shares of RCBC to HIHL for 29 pesos ($.67) per share. "RCBC represents a very attractive investment opportunity for CVC in one of the fastest developing banking markets in Asia," Tze-Ching Chan, senior advisor to CVC and a member of CVC's Global Financial Institutions Advisory Board, said in a statement.

The deal comes two months after RCBC sold a more-than 7% stake of itself to the World Bank's investment arm IFC, for more than 2.1 billion pesos (approximately $50 million).

According to RCBC's website, the company is among the Philippines' five largest private domestic commercial banks, claiming that it "triumphantly [rode] out the global economic crisis with a P3.31 billion ($76.6 million) net income in 2009, a growth of 54% from 2008." For the first quarter of 2010 it posted $22.6 million in net income, and claims total consolidated resources of $6.5 billion.

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