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Colombia's deposit insurance fund Fogafin will narrow the number of bidders to four in the upcoming auction of the government's largest state bank Bancafé, local daily La República quoted Fogafin head Andrés Flórez as saying.
Last month, Fogafin delayed the second phase of the tender process for Bancafé to October 12 from the original October 2 date.
Flórez said Fogafin will split the tender process into three parts, with the first starting on October 10, when interested bidders must place an offer at least equal to the minimum price of 1.10tn pesos (US$457mn).
Flórez said Fogafin will begin opening envelopes and ditching the lowest offers until it reaches the final four in a bid to boost Bancafé's final price. After submitting new bids, Fogafin will choose the two highest offers and then receive final offers after an hour's interval, Flórez detailed.
The bidding process for Bancafé is now open only for the so-called "solidarity sector" comprising employees, cooperatives and pension funds, which runs until September 17, when it is the turn of private companies and investors.
Analysts have said the bank's final price could double due to strong interest from foreign banks.
"This is a new and different bank because its pension and labor liabilities - which used to scare investors away - have been fixed. It does not have labor problems, its administrative expenses are lower than average and it has less personnel than the former entity. It is the last jewel of the crown," Flórez said.
So far, eight locally owned and foreign banks have paid the 50mn-peso data room fee to look at Bancafé's books.
They are Colombia's largest bank Bancolombia (NYSE: CIB) as well as domestic players Banco de Bogotá, Colpatria, Davivienda and GNB Sudameris.The foreign contingent comprises Citigroup (NYSE: C), Grupo Santander (NYSE: STD) and General Electric (NYSE: GE).
Bancafé is Colombia's seventh largest bank with a roughly 6.1% market share. It has a network of 236 branches and some 1.5 million customers.