National Bank of Greece (NYSE:NBG) Continuing Pursuit of Alpha

National Bank of Greece SA, the nation’s largest lender, said its 2.8 billion-euro ($3.8 billion) bid for Alpha Bank SA, the third-biggest, will be received positively by investors after Alpha spurned the offer.

“The strategic and financial merits of the combination are compelling to both banks and their respective shareholders,” Chief Executive Officer Apostolos Tamvakakis said on a conference call today. “We are confident that the market will receive this proposal positively and express its position accordingly.” He wouldn’t take questions from reporters.

Alpha’s board voted unanimously Feb. 18 to spurn National Bank’s offer of about 5.50 euros in shares. The bid values Alpha at about half its book value, a lower multiple than in the previous four European bank takeovers in Europe of more than $1 billion in the past year, data compiled by Bloomberg show.

Bank of America Corp. (NYSE:BAC) and Morgan Stanley (NYSE:MS) are advising National Bank, while Citigroup Inc. (NYSE:C) and JPMorgan Chase & Co. (NYSE:JPM) are advising Alpha Bank.

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National Bank of Greece (NBG) Bid Rejected by Alpha Bank

The $3.8 billion unsolicited from National Bank of Greece SA (NYSE:NBG) for Alpha Bank SA, was rejected as an inadequate offer by Alpha's board.

National Bank of Greece SA is the largest in the country and Alpha Bank is the third-largest bank in Greece.

When making the offer for Alpha on January 18, National Bank asked for Alpha to give the bid “serious consideration.”

National Bank said the new entity would be much stronger and wouldn't have to rely so much on emergency funding to survive.

National Chairman Vassilis Rapanos said today, “The proposed merger would create the leading bank in Greece, which we believe would be pivotal in supporting the recovery of the Greek economy. I am deeply convinced about the merits of this transaction and I believe it would resonate favorably with shareholders of both banks.”

The rejection by the Alpha board was unanimous, with some industry watchers believing they may change their mind if the offer is sweetened.