ICBC targets Argentine lender
Source: Bloomberg News |
August 6, 2011, Saturday
|
Print Edition
Print Edition
THE Industrial and Commercial Bank of China, the nation's biggest lender, has agreed to pay US$600 million for assets controlled by Standard Bank in Argentina in its biggest takeover in more than three years.
The Chinese bank will pay cash for an 80 percent stake in Standard Bank Argentina, Standard Investments and Inversora Diagonal, ICBC said in a statement to the Hong Kong stock exchange yesterday.
The Beijing-based lender and Standard Bank London Holdings also plan jointly to invest US$100 million in Standard Bank Argentina after the transaction is completed.
The acquisition extends ICBC's global expansion in Argentina, South America's second-largest economy, augmenting plans announced this year to open a bank in Brazil and buy a US lender. ICBC, which aims to be the first Chinese lender to operate in Argentina, would gain 103 branches in a nation whose second-largest trading partner is China.
"ICBC's expansion overseas is in line with the broader trend of Chinese companies tapping into the international market. ICBC may make more acquisitions in Latin America and Asia," said Grace Wu, head of China banking research at Daiwa Capital Markets Hong Kong.
The Chinese bank, which acquired a 20 percent stake in Johannesburg-based Standard Bank for about US$5.4 billion in March 2008, is Standard's largest shareholder.
The sale of the Argentine unit underscores Standard Bank's reversal of strategy, intending to focus on Africa, where it has operations in 17 countries.
The lender sold its stake in Russia's Troika Dialog investment bank earlier this year and plans to use the US$372 million proceeds to make acquisitions in Africa to benefit from increased trade and investment banking transactions with emerging markets.
ICBC has announced takeovers and investments valued at a combined US$2.1 billion since the beginning of 2008, including spending US$1.4 billion to increase its stake in its Hong Kong unit about a year ago, according to data compiled by Bloomberg News.
ICBC said in January that it had agreed to buy an 80 percent stake in Bank of East Asia's US operations for US$140 million. The transaction is awaiting regulatory approval.
The Chinese bank will pay cash for an 80 percent stake in Standard Bank Argentina, Standard Investments and Inversora Diagonal, ICBC said in a statement to the Hong Kong stock exchange yesterday.
The Beijing-based lender and Standard Bank London Holdings also plan jointly to invest US$100 million in Standard Bank Argentina after the transaction is completed.
The acquisition extends ICBC's global expansion in Argentina, South America's second-largest economy, augmenting plans announced this year to open a bank in Brazil and buy a US lender. ICBC, which aims to be the first Chinese lender to operate in Argentina, would gain 103 branches in a nation whose second-largest trading partner is China.
"ICBC's expansion overseas is in line with the broader trend of Chinese companies tapping into the international market. ICBC may make more acquisitions in Latin America and Asia," said Grace Wu, head of China banking research at Daiwa Capital Markets Hong Kong.
The Chinese bank, which acquired a 20 percent stake in Johannesburg-based Standard Bank for about US$5.4 billion in March 2008, is Standard's largest shareholder.
The sale of the Argentine unit underscores Standard Bank's reversal of strategy, intending to focus on Africa, where it has operations in 17 countries.
The lender sold its stake in Russia's Troika Dialog investment bank earlier this year and plans to use the US$372 million proceeds to make acquisitions in Africa to benefit from increased trade and investment banking transactions with emerging markets.
ICBC has announced takeovers and investments valued at a combined US$2.1 billion since the beginning of 2008, including spending US$1.4 billion to increase its stake in its Hong Kong unit about a year ago, according to data compiled by Bloomberg News.
ICBC said in January that it had agreed to buy an 80 percent stake in Bank of East Asia's US operations for US$140 million. The transaction is awaiting regulatory approval.
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