JC Flowers in talks to buy €1bn CAM stake

The investor has spent the past month and a half in talks over the prospective deal, which is dependent on the Spanish state's restructuring fund, the Frob, agreeing to be a guarantor for up to €2bn of losses. The Bank of Spain has so far only agreed to guarantee against losses in cases where it has taken over savings banks because of their financial instability, steadied them and sold them at public auction.

Such was the case for CCM and CajaSur, but experts claim it is unlikely to apply to CAM, which means JC's best bet could be to invest in the bank once the Frob has completed its bail-out.

If JC does decide to wait, the state will inject €2.8bn of public funds, thus taking control and fully nationalising the entity. The capital is necessary for CAM to comply with the solvency requirements imposed by the local government in February with a view to calming the markets.

Santander and BBVA banks have also expressed an interest in investing in CAM if an auction process is held.

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• Topics
• Southern Europe
• Financials
• Restructuring
• Spain