BPCE to Acquire 75% Stake in Novo Banco
Deal News | Jun 13, 2025 | EIN
In a significant move within the European banking sector, the French lender BPCE is set to acquire a 75% stake in Portugal's Novo Banco from Lone Star, a US private equity firm. The transaction values Novo Banco at €6.4 billion and marks one of Europe's largest banking deals in recent years, driven by a wave of consolidation across the industry. The acquisition underscores BPCE's strategy to diversify geographically by entering a new core retail market and expanding its exposure to variable-rate loans, prevalent in Portugal. Novo Banco, established in 2014 after the collapse of Banco Espírito Santo, has made notable progress under Lone Star's ownership but still faced challenges such as legacy bad loans. The deal, expected to close in the first half of 2026, reflects a broader trend of cross-border mergers and signifies BPCE's commitment to strengthening its position in the Portuguese market. This transaction is amid ongoing talks between BPCE and Portuguese authorities about potentially purchasing the remaining 25% stake in Novo Banco. The acquisition aligns with a broader restructuring trend among European banks and follows other notable mergers across the continent.
Sectors
- Banking
- Private Equity
Geography
- France – BPCE, the acquiring entity, is a French banking group illustrating the cross-border nature of the deal with Portugal.
- Portugal – Novo Banco, the target company, is a major Portuguese bank, making the transaction centrally relevant to the country's financial sector.
- United States – Lone Star, the seller of the Novo Banco shares, is a private equity firm based in the United States, thus involving the US geography in this transaction.
Industry
- Banking – The core industry involved in this transaction is banking, as it concerns a significant merger between two financial institutions aimed at geographical and operational expansion.
- Private Equity – The role of private equity is exemplified by Lone Star's ownership and eventual sale of its stake in Novo Banco, highlighting the interaction between private equity investments and the banking sector.
Financials
- €6.4 billion – The valuation of Novo Banco in the transaction between BPCE and Lone Star.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| BPCE | Acquirer | Company | A major French banking group acquiring a 75% stake in Novo Banco. |
| Novo Banco | Target Company | Company | A Portuguese bank that was created as a 'good bank' from Banco Espírito Santo's collapse. |
| Lone Star | Seller | Company | A US-based private equity firm selling its 75% stake in Novo Banco. |
| Portuguese Government | Regulatory Body | Government | The regulatory authority in Portugal overseeing banking mergers and sales. |
| CaixaBank | Competing Bidder | Company | A Spanish banking group that considered bidding for Novo Banco. |