Bloomberg News

XP Plans to Buy Two Brazilian Brokerages This Year

December 06, 2011

(Updates with Actis LLP investment in fourth paragraph.)

Nov. 29 (Bloomberg) -- XP Investimentos CCTVM SA is in talks to acquire two Brazilian brokerages before the end of the year as it seeks to challenge banks in the business of investment services.

“We want to compete with banks”, XP’s partner and general director Guilherme Benchimol said in an interview at the company’s office in Sao Paulo yesterday, without disclosing the names of the brokerages the firm is in talks with, or the estimated value of the transactions. “XP’s objective is to be a financial shopping center, to allow investors to compare and invest in various alternatives, including those offered by banks.”

One of the targets is based in Sao Paulo and the other in Rio de Janeiro, the two largest Brazilian cities, Benchimol said. XP is also in similar discussions at different stages with eight other brokerages, the executive said.

XP last year received an investment of $58 million from London-based Actis LLP, which got a minority stake in the brokerage. In October, XP clinched a partnership with Senso Corretora de Cambio e Valores Mobiliarios SA, which increased its traded volume that month to 20.8 billion reais ($11.3 billion). A month earlier, it agreed to buy online information provider InfoMoney, after forming another partnership with online broker Interfloat HZ CCTVM Ltda in June.

The Rio de Janeiro-based firm didn’t disclose financial details of those transactions, which were not acquisitions as they didn’t involve an equity transfer that would require central bank approval, Benchimol said. They were actually partnerships that resulted in the transfer of clients to XP, according to the executive.

XP plans to invest as much as 20 million reais in an advertising campaign in the first half of 2012 aimed at attracting new clients, Benchimol said.

--Editors: Helder Marinho, Adriana Brasileiro

To contact the reporter on this story: Felipe Frisch in Sao Paulo at ffrisch1@bloomberg.net

To contact the editor responsible for this story: Helder Marinho at hmarinho@bloomberg.net


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