Latvia's Citadele Bank has suspended its initial public offering (IPO), the business daily Dienas Bizness reported on Wednesday.
The decision to postpone the IPO was taken because of a changeable stock market situation and in order to thoroughly analyze alternative funding proposals the bank has received during the offering, the bank's representatives said.
Although the Citadele IPO has attracted strong interest both from institutional and private investors the current market conditions are not favorable for the implementation of the original plan, the bank said. Citadele Bank announced the plan to float on Nasdaq Riga and the London Stock Exchange in mid-October, saying it wanted to raise 115 million euros (about 123 million U.S. dollars) by selling its new shares.
The bank said it intended to use the money to expand its business in Latvia and other Baltic states, as well as to repay 34. 7 million euros worth of subordinated debt to the Latvian Privatization Agency.
Citadele Bank, established as a result of restructuring Latvia' s bankrupt Parex Bank, became operational in August 2010.
In late 2008, the Latvian government took over the privately-owned Parex Bank, which was the second largest bank in Latvia at the time, in order to save it from looming bankruptcy amid the global financial crisis. Earlier this year, Citadele Bank was sold off to RA Citadele Holding -- a subsidiary of U.S. equity firm Ripplewood Advisors LLC -- and a group of 12 multinational investors. (1 euro = 1.07 U. S. dollars)
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