Banks, Financial Services, Good for Business, Latvia, Mergers and take-overs

Nordea and DNB have entered into an agreement to jointly sell 60% of Luminor to Blackstone. As a result of the transaction, each of Nordea and DNB will hold 20% of Luminor. Nordea and Blackstone have additionally entered into a forward sale agreement for the sale of Nordea’s remaining 20% stake over the near to medium term.

The transaction is a subject to customary regulatory approvals and is expected to close during the first half of 2019.

"Blackstone's investment is fully aligned with the bank's vision, and their support will both strengthen and accelerate the execution of our strategy to become the leading independent financial group focused on the Baltic region," Nils Melngailis, chairman of the supervisory board of Luminor Group, said in the press release.

"This transaction represents a significant foreign direct investment in the region and as one of the largest private equity deals in Baltic history, Blackstone’s decision to invest in Luminor represents a validation of our strategy and is a vote of confidence in the economic outlook for Estonia, Latvia and Lithuania," he added.

As reported, DNB and Nordea in 2017 merged their businesses in all three Baltic states to create a new combined bank called Luminor. As part of the merger, the Latvian branch of Nordea Bank has turned its assets over to DNB Banka.