TAIPEI: Private equity funds SAC Capital and GE Capital are in no hurry to sell their stakes in Taiwan's Cosmos Bank and would be looking for a price of at least $1.15 billion before considering any deal, according to Cosmos' chairman.
Right now, Paul Lo told Reuters in an interview on Tuesday, the investors are waiting for Cosmos to turn to a profit, which could happen this year for the first time since 2008, meaning more chance of them getting more than the T$12-T$13 per share they paid for their combined 82 percent stake in 2007.
"If you offer that price, they can consider it," Lo said in an interview in the bank's office in the Taipei 101 skyscraper building. "SAC and GE are not hiring any investment bankers or looking for any buyers. They are in no hurry now."
The comments indicate that the two firms will not be joining a list of those recently looking to cash out of their investments in Taiwan's overcrowded banking sector.
Carlyle Group and Longreach have begun the process of selling their respective stakes in Ta Chong Bank and EnTie Bank, while Newbridge, Nomura Holdings and billionaire investor George Soros have all cut their stakes in Taishin Financial.
A crowded home market and limited access to the huge China market have weighed on Taiwan banks. Their return on assets in 2011 was 0.53 percent, the lowest among banks in Asia excluding Japan, according to Fitch Ratings.
Cosmos posted losses of T$300 million ($10.2 million) in 2011 and T$3.4 billion in 2010, according to data from the Taiwan stock exchange. Cosmos shares ended at T$7.14 on Tuesday.
Chinese banks have been touted as possible buyers for stakes after Taiwan agreed to allow partial investment by China in the sector earlier this year.
But the five percent limit on any stake isn't enough to attract those buyers, and Taiwan's banks have been pushing for a higher limit, which regulators are considering.
"I've been to the mainland recently. None of the Chinese banks we've talked to was interested," Lo said.
"They wanted at least 10-15 percent."
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