Novobanco could be the biggest IPO of the decade

That’s according to the US ratings agency Standard & Poors that forecasts the floatation of the decade could double the value of the largest transaction so far over the past five years.

“The Novobanco IPO could be the biggest stock market floatation of a European bank in years”, states the S&P note.

The valuations for the bank that are known vary with the biggest pointing to €7Bn.

“The largest banking IPO in Europe in the last decade was the IPO of ABN AMRO Bank NV in 2015, worth €3.84Bn,” the agency said. This would not only place the IPO of Novo Banco in first position, but if the best valuation is confirmed, it could almost double the current record.

And according to a back-of-the-envelope calculation from the business daily Negócios, the IPO could be the fifth largest European floatation of a bank so far this century.

Novobanco shareholders have approved a capital reduction of €1.1Bn permitting a distribution of dividends of the same value.

The US fund Lone Star, which holds 75% of the capital, is expected to receive €825 million. The Resolution Fund, with 13.54%, will net approximately €149 million. The remaining €126 million will be transferred to the State, which holds 11.46%.