Fortis (FORB) Up 12%, Despite Setbacks
Oct 3rd, 2008 | By Stephanie Grimmett | Category: Financial News, International InvestingFortis (FORB) just sold itself to three different European governments. The company lost its deal with China’s Ping An Insurance, and its sale to Deutsche Bank is being held captive by the Dutch Central Bank. But FORB is up 12% today. The hits just keep on coming, but the stock price is still rising.
Fortis (Brussels:FORB), the Dutch bank that already suffered the humiliation of being propped up by, not one, but three different governments, just lost its deal with one of China’s largest insurers. And the company’s commercial banking sale to Deutsche Bank (NYSE:DB) has been put on hold by regulators until further notice.
Earlier this week, Fortis had to go begging to the government, but it didn’t just get aid from its native Dutch government. It also sold itself to the Belgian and Luxembourg governments. Each of the trio bought 49% of the bank’s units inside their respective borders. And now it has three masters, four, if you count the investors who drove up its price 12% today.
We saw the result of this action ripple through Fortis’s joint venture partners on Monday, when it shook down Royal Bank of Scotland (NYSE:RBS) for 24% of its stock price.But that wasn’t the end of it. Today, Fortis had to cancel the sale of half of its asset-management wing to Ping An Insurance (Pink Sheets:PNGAY) (you may remember it from it’s IPO) for 2.15 billion euros ($3.03 billion).
Ping An has designs to become a full-service financial company, but the deal was made in March, before Fortis became a bargain-basement seller, and would have required an immediate writedown on Ping An’s part.
Fortis has also been thwarted by the Dutch Central Bank in the sale of it’s commercial banking assets to Deutsche Bank.
And despite the fact that Fortis can’t even give itself away, the stock is up nearly 12% today… I wouldn’t trust that gain too much.
Source: Fortis (FORB) up 12%, despite setbacks
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