Corrected: HSBC close to dropping $8 billion Nedbank bid: report

(Corrects bid figure in headline to $8 billion from $5.3 billion)

LONDON (BestGrowthStock) – HSBC (HSBA.L: ) could drop out from an $8 billion bid for South Africa’s Nedbank (NEDJ.J: ), the Financial Times said in its Friday edition, as exclusive talks with majority owner Old MutualL> are due to expire this weekend.

The newspaper cited people close to the bank as saying HSBC is not in a position to make an offer for Nedbank before this two-month period finishes.

It said HSBC executives have conceded the move could pave the way for UK rival Standard Chartered (STAN.L: ) — which had previously shown interest in buying Nedbank — to gain the upper hand in the bidding for South Africa’s fourth-biggest bank.

StanChart Chief Executive Peter Sands on Wednesday dismissed talk that cash from a $5.3 billion rights issue the bank launched will be used for a big deal, such as in South Africa, which has been rumored.

“This is not a war chest for acquisitions,” he told reporters.

If HSBC dropped out of the bidding, StanChart executives told the FT the price Old Mutual could expect for its stake would have to fall below the benchmark of a 15 percent premium to Nedbank’s market price.

“If HSBC walked away and if Old Mutual’s price expectations came down, then who knows?” the FT quoted a banker close to StanChart as saying.

HSBC and Nedbank were not immediately reachable for comment.

(Reporting by Karolina Tagaris; Editing by Phil Berlowitz)

Corrected: HSBC close to dropping $8 billion Nedbank bid: report