Post Blesa reveal the purchase without bank controls Miami

Question

Post Blesa reveal the purchase without bank controls Miami

Answer 1

Miguel Blesa, president of Caja Madrid, should explain this Friday before a different judge that sent him to prison purchase, November 7, 2008, the City National Bank of Florida. Will ask the judge Juan Antonio Toro, after Elpidio inhibited José Silva, challenged by Blesa. The operation was formalized in two phases: the acquisition of 83 % for 927 million dollars (618 million euros) and an option to purchase in the coming months the remaining 17 % by 190 million plus interest, which ran for 207 million dollars. In sum, paid 1,127 million dollars, about 747 million euros.

The total figure is crucial. Not only because he is accused of more than half of the amount paid -450 000 000 euros - was simply overpriced, but because the light of the overall figure regulations requiring permission of the Community of Madrid for the above transactions was breached 5% equity. The Bank of Spain, in a report dated April 19, 2010, considered that the subdivision was a mere ruse: " This form of instrument purchase CNBF allowed to circumvent the mandatory control of the Ministry of Economy of the Community of Madrid for transactions exceeding a certain percentage of the equity of the boxes Madrid (Caja Madrid). "

Blesa mails seized by the former investigating judge show interest in seek solutions to avoid such legal stop forcing requesting authorization to purchase the Community of Madrid, whose government, headed by Esperanza Aguirre, maintained a tense relationship.

The April 28, 2008, Blesa receives a report of an advisory indicating that 5% of equity is 672 million, so the acquisition of 83 % of the City by $ 585 million fits. Nothing says the e- mail of the remaining 17%. Both agreements, however, signed the same day: April 8, 2008. Payment of 17% will put damper. He introduced himself as purchase option. But let all tied inexorably to exercise, initiated by the seller or the buyer.

Documents Caja managers handled and displayed on some of the emails, reveal these maneuvers.

The December 14, 2007, presented the plan to purchase City Caja steering committee. This document contains a clear message: "We have the opportunity to acquire 100 % of City National Bank of Florida by 1.300 million dollars." You buy 100% and by 1,300 million. No 83% and only 926 million. The operation, says the document, you need to " be authorized by the Community of Madrid." This is for " more than 5% of the eligible capital of Caja ". The average rating given to the City that is below the price: 854 million, 450 million less. However, when Blesa faces the Board of Directors on April 14, 2008, six days after signing the two agreements of purchase gives different information. One stands a figure: you must pay 618 million euros for the 83 % of the bank. The other is described as a mere option whose price is not detailed, nor the degree of constraint. In the document where the necessary authorizations for the operation is no longer included detailed permission Madrid.

The first judge on the case has held that this was a deliberate strategy of deception to circumvent the control of the Community. The e- mails Blesa fed that suspicion. On December 18 tells one of his lieutenants: "On the CAM already have something in mind."

Just a few months later, the new document had managed Blesa eliminated the need to seek authorization from the Community of Madrid for the acquisition of the bank.

The Bank of Spain, in a report over a year later, has held that the price paid was particularly expensive: " The agreed purchase price for 100 % of National City at the time assumed a multiplier of 3.7 its value carrying a PER ratio of 32.9. The price was so apparently significantly higher than purchases by the Banco Sabadell and Banco Popular Spanish of respective banks domiciled in Miami, as the transaction price over book value were 3.4 and 3.5, respectively, and PEs [ benefit payment ] of 19.4 and 14.9 ". About 1,112 million recorded, inspectors of the Bank of Spain saw the amount of impairment ranged between 540 and 572 million.

The proceedings of the Board of Directors of Caja reflect how Blesa avoided certain controls. At its meeting of April 14, 2008, voices rose directors requesting an "independent" assessment of the City, singularly popular Estanislao RodrÃ_guez- Ponga. Glared blesa this claim: "I think now untimely intervention of an investment bank to contrast the valuation." He noted that Deutsche Bank had supported the assessment, although " there is no formal report."

Also went unheeded requests to clarify whether they had requested " all necessary authorizations " under the law of boxes. No explicit the meeting why he had not asked for the approval of the Community. Directors finally approved the only data that knew cart: payment of 618 million for the 83 % stake. The record reflects nothing on the second payment. Blesa not only opposed to "double check" who asked some directors. The April 24, 2008, signed and approved the purchase contract, is blunt: " I ​​do not know if you have request from the supervisory documentation on Operation Palm [ purchase of City]. Not a letter, not a letter, that I gestionaré matter what. " The popular Paul Bee, president of the supervisory board, asks for explanations on contracts already signed and approved by the Council. Blesa refuses to hand over the contract. " It has not produced the purchase of the bank and, therefore, no contract of sale " officially responds. The internal language Blesa with yours, in e- mails is another: " I know I will not submit." Or put another way: " The supervisory committee will monitor contracts never shopping box. It is his mission. "