One of the country's fastest-growing retail banks and a leading Dublin private-equity firm are teaming up with a view to making a €1 billion-plus bid for Irish Nationwide Building Society.
Bank of Scotland (Ireland) - which operates as Halifax in the retail market - and Quinlan Private, the Dublin wealth management firm led by financier Derek Quinlan, have made exploratory contact with the society.
Quinlan Private is one of the few Irish private-equity firms that could afford Irish Nationwide, which is expected to carry a price tag of €1-€1.5 billion if the sale process begins. About 100,000 qualifying members would be in line for payments in the region of €10,000 each.
Given its involvement in large-scale property deals, Quinlan Private would be interested in Irish Nationwide's commercial property investments. Irish Nationwide has developed relationships with some of the country's biggest property developers, including Sean Mulryan and Sean Dunne.
Bank of Scotland (Ireland) would be attracted to Irish Nationwide's retail mortgage book and possibly some of its branches, although sources said last night it may walk away, now that its involvement has become public.
Quinlan Private would be interested in Irish Nationwide's branches, some of which are located in key city and town-centre locations around the country. It would buy and lease back any branches that interested Halifax, and sell or develop the remainder.
Bank of Scotland (Ireland) and Quinlan Private are among several parties, including Icelandic bank Landsbanki and US lender GE Money, which have shown an interest in Irish Nationwide.
A spokesman for Bank of Scotland (Ireland) declined to comment. No one was available for comment in Quinlan Private. Landsbanki, which has been examining Irish Nationwide since earlier this year, has sought trading information from it outlining its exposure to troubled credit markets. An Irish Nationwide spokesman declined to comment on the information provided to Landsbanki.
It is believed the Icelandic bank does not believe it has sufficient information on the building society to allow it to make a bid.
Irish Nationwide's chief executive Michael Fingleton will be keen for a quick sale as the credit and liquidity crisis over the last six weeks has led to sizeable, sudden fluctuations in the value of financial institutions and is expected to have a negative effect on the price sought for Irish Nationwide.
The declining value of bank stocks and the building society's exposure to the property market are expected to limit its number of suitors.The building society is thought to be several weeks away from appointing advisers to conduct the sale process.
