Private-equity consortium Blackstone Group has agreed to pay one billion euros to Nordea and DNB for 60 per cent of their joint lender in the Baltic region, Luminor.
“There is no other independent bank in this region that covers Estonia, Latvia and Lithuania with such a significant footprint,” said Erkki Raasuke, CEO of Luminor. “Our partnership with Blackstone will strengthen this position for years to come, and provide Luminor with the capital needed for investments in new and exciting technologies needed to develop its digital offering as well as expanding current products and services.”
Following the sale Nordea and DNB will for now each retain a 20 per cent share in Luminor, although Nordea has already announced that it wants to sell its stake over the next few years.
DNB however will continue to hold its minority share.
“We want to be among Luminor’s minority shareholders because we believe that the company is valuable to its customers, employers and shareholders,” said Kjerstin Braathen, CFO at DNB. “The bank has a strong digital focus, very competent employees and a comprehensive representation in the Baltic states.”
“This is an exciting opportunity to invest in an excellent business operating in an attractive market,” said Nadim El Gabbani, senior managing director at Blackstone. “We believe that Luminor is well positioned to continue to lead the market as an independent provider of financial services. We are excited by the partnership with management; Nordea and DNB and look forward to working together to create a stronger platform for further growth.”
“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,” said Nils Melngailis, chairman of the Luminor board.