Wall Street bet 140mil on the deal that went wrong!

Thousands of investors were placed in the Adr of the NBG share on Wall Street after a friendly merger proposal, but whether they will lose their money will depend on the mood and actions of Greek bankers, namely whether a new competitive bid will be put on the table.

The Adr (5 such certificates are a share of NBG) began the session at $ 2,16 and two hours later was earning up to 14%, reaching $ 2,37. In fact, the buyers were persistent - as is the case with stock exchanges such as New York's - when taking the shares from the sellers, slightly higher, that is, than the position of buyers.

Apart from a friendly merger proposal, a rumor about a German project on the Greek debt was released on W.S. Indeed, many in the U.S. believe that these price levels are the lowest, and say that from now on the trend will be upward in view of a solution to the debt.

When the negative answer of Alpha was announced however, the Adr started to reduce its profits and by the end of the meeting, had lost almost all the increase. It closed at $ 2,21 with profits at 6,76%, while in the after hours process the stock moved to $ 2,25.

A total of 90 million Adr were handled, ie 18 million shares, a quantity many times higher compared to the cuts in Athens, worth almost 140mil euros.

God help us on Monday

Whether American investors are right will be seen at the opening of the stock market in Athens on Monday, as an abandonment of the merger attempt would be a clear blow against foreign investors.

And the last thing that the country wants right now is to be left to the mercy of the market moods. Stock markets are not churches but many times they operate with "psalms", "chanters" and unwritten rules.

The NBG proposal (8 NBG shares for 11 of Alpha) was rejected by the Alpha Bank administration, who talked about uncertainty and inexpedient terms.

The NBG replied to the rejection, saying that it will work for it, but did not avoid noting that were surprised, mainly for two reasons:

1. The uncertainty in Alpha’s announcement can be cleared directly by the National Bank's proposal. The 25th bank in Europe is created and ultimately “the lone reed in the field cannot find a better way to deal with the crisis”.

2. The second reason for which the National Bank does not believe in Alpha’s answer is the fact that the shareholder of the specific bank will see a 40% raise in the value of the share in the new bank as the synergies from the merger are estimated at 3,5bil euros. 30% of these synergies go to the shareholder and the value increase, according to executives of NBG.

NBG: “You are the ones who put a stop to the talks”
In fact, a high-ranking member of NBG was saying that the surprise is even bigger since until February 17 Alpha had been in talks, then put a stop to the talks and held a board meeting, essentially leaking the discussion into the market.

The last phrase, «you are the ones who put a stop to the talks» is far from random, as there is a possibility that NBG might move aggressively, abandoning the proposal of a friendly buyout.

In any case, the real reason for the rejection was the fact that Alpha’s position in the new deal would be 29% against 71% for NBG, while if concluded in previous years, the same deal would have been at 39% - 61%...

Executives from NBG are wondering as to which the alternative proposal of Alpha Bank is to deal with the recession…