Denizbank AS (DENIZ) plunged the most on record after owner Dexia SA (DEXB) said it had entered exclusive negotiations with Russia’s OAO Sberbank (SBER) to sell the unit for a price below the current market value.
The shares fell 20 percent to 14.20 liras at the close in Istanbul, their biggest loss since at least 2004.
The Moscow-based lender may agree to pay as much as 1.5 times Denizbank’s book value, valuing the bank at about $4 billion, said one person close to the deal, who declined to be identified as the process is private. Denizbank’s current share price gives it a price-to-book ratio of 2.1, according to data compiled by Bloomberg.
Dexia’s annual report in April showed Denizbank had a carrying value at the end of last year of 2.8 billion euros ($3.5 billion), the minimum amount Dexia needs to sell it for to avoid taking a hit to its capital.
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