Nykredit Offers $3.5 Billion to Buy Spar Nord Bank

Denmark’s Nykredit Realkredit and Spar Nord Bank have signed an agreement, under which Nykredit has offered to acquire all shares in Spar Nord Bank (with the exception of Spar Nord Bank’s holding of treasury shares) for $3.5 billion offering $29.6 per share.

The Board of Directors of Spar Nord Bank intends to recommend the shareholders to accept the offer once it is submitted in the form of an offer document approved by the Danish Financial Supervisory Authority (FSA). It is expected that the deal will be completed during the first half of 2025.

The Spar Nord Foundation, which currently owns 20.27% of the share capital of Spar Nord Bank, and all members of the Board of Directors and the Executive Board of Spar Nord Bank holding Spar Nord Bank shares have made binding and irrevocable advance undertakings to accept the offer subject to specific conditions.

Nykredit currently owns 19.6% of the total share capital and voting rights of Spar Nord Bank.

Taking into account the irrevocable advance undertakings made by the Spar Nord Foundation and the Board of Directors and the Executive Board of Spar Nord Bank owning Spar Nord Bank shares, Nykredit is secured acceptance from shares in Spar Nord Bank equivalent to 40.17% of the aggregate share capital and voting rights.

The Offer represents a premium of approximately 49% relative to the closing share price of $19.82 on 9 December 2024 and a premium of around 58% relative to the volume-weighted average trading price of $18.77 for the period from 9 September 2024 to 9 December 2024.

Nykredit believes that, in terms of value, the Offer represents a highly attractive offer for the shareholders of Spar Nord Bank.

Strong Match

Nykredit Chairman Merete Eldrup said that the two banks were a strong match as both have values and core competencies that, combined, will increase their impact in the market.

He said that Spar Nord Bank has a long tradition as a locally anchored relationship bank with decentralised decision-making powers and special strengths in the personal customer and the small and medium-sized business customer segments.

According to him, Nykredit Bank is currently one of the largest lenders to large corporate customers, agriculture and the real estate sector, as well as one the largest wealth management advisers. In addition, Nykredit takes a special approach to sustainability, fixed prices and customer-based value offerings for Danish homeowners.

“By joining forces, we can show even more customers that there is a customer-owned alternative in the financial sector and stand even stronger in the competition with the largest listed banks,” he added.

Third Largest Bank

Once the merger process is completed, the new entity will be the third largest in Denmark. Currently Nykredit and Spar Nord are Denmark’s fourth and sixth largest banks in terms of lending, respectively.

The merged bank will become one bank, but the branches will continue to have different names and logos. Nykredit has no plans to merge branches in 2025. The long-term goal is to create a smooth transition, the company announcement states.

However, there may be a need to evaluate in some cities where there may be overlapping activities, it said.