Caixabank and Isabel dos Santos are thrashing out final details of a deal for the Spanish bank to buy the Angolan investor's stake in Portugal's Banco BPI, sources said.
Portugal's securities market regulator suspended trading in BPI shares earlier on Tuesday, pending an announcement, but the sources said a deal was still in the works and gave no estimate on when it may be completed.
"We're in a phase of constant exchanges of protocols between the two sides for a deal that is complex and involves many entities," one source with direct knowledge of the talks said.
Among the details still to be pinned down are forms of payment and future options, the source told Reuters.
Dos Santos, Africa's richest woman according to Forbes, is the daughter of Angola's long-serving President Jose Eduardo dos Santos and has various investments in Portugal.
Before moving towards a deal this month, the two parties had been at loggerheads for months over an existing 20 percent cap on Caixabank's voting rights that blocked the Spanish bank's bid last year for the 56 percent of BPI it did not already own.
Under the agreement now being discussed, Caixabank would buy dos Santos' 18.6 percent stake in BPI while Unitel, the Angolan telecoms firm she controls jointly with Sonangol, would buy a controlling stake in BPI's Angolan unit BFA. BPI holds a 50.1 percent stake in BFA, while Unitel owns the other 49.9 percent.
If it buys out dos Santos, Caixabank would have to launch a full takeover bid for the remainder of BPI, sources said. Caixabank was not available to comment on the talks.
The sources said that if dos Santos pulls out of BPI, she would consider taking a stake in BPI's bigger rival Millennium bcp, whose largest single shareholder is Angolan oil company Sonangol which holds a 19 percent stake.
Millennium bcp holds 700 million euros in costly state loans which could be repaid by allowing a new shareholder in.
"The Portuguese government has already given its nod of approval to such a scenario. Such an entry could be done via a capital increase, for example, capitalising the bank so it can pay the state," the source said.
However approval by the European Central Bank would be required since the Angolan shareholders would have a dominant position, the second source said.
On April 10, European authorities will require banks to fully provision for Angolan assets and a failure by BPI to offload its assets there by then could lead to heavy costs.