Banco Santander SA, Spain’s largest bank, will list American depositary receipts as part of an initial public offering for its Mexican unit.
The sale will be carried out in Mexico, the U.S and other international markets, according to filings released today on the website of the Mexican stock exchange.
Economic and population growth in Mexico offer a “favorable environment,” Santander said in a prospectus. The bank said low banking penetration and a stable financial system will drive expansion in Mexico.
Santander seeks to raise as much as $4 billion in a record Mexican IPO, two people familiar with the matter said yesterday. Grupo Financiero Santander Mexico SAB will probably sell a 25 percent to 30 percent stake after the first week of September, said one of the people, who asked not to be identified because the information isn’t public.
Today’s filings didn’t specify a price range or target date for the IPO. The Spanish parent company and Santusa Holding SL will sell a portion of their stakes in the transactions. The bank has shares in Mexico that represent 0.13 percent of the company, which stem from Santander’s purchase of Grupo Financiero Serfin SA in 2000, the filings show.
Santander will participate as an underwriter on both the international and Mexican share sales. UBS AG, Deutsche Bank AG, and Bank of America Corp. will be global coordinators while Barclays Plc, Goldman Sachs Group Inc., Citigroup Inc., JPMorgan Chase & Co., Credit Suisse Group AG and Royal Bank of Canada will be joint bookrunners, according to the filings. The local units of Banco Bilbao Vizcaya Argentaria SA (BBVA), HSBC Plc and Citigroup will underwrite the Mexican secondary offering along with Santander itself.
Santander’s Mexican unit, the nation’s fourth-largest lender by outstanding loans, seeks to gain market share by focusing on lending to small businesses and targeting the consumer and mortgage markets, according to the prospectus.
The bank plans to spend 1.8 billion pesos ($137 million) over the next two years to open 200 new branches, said Juan Moreno Blanco, vice chairman of commercial banking of the bank at an event in Mexico City, July 26. It reported first-half net income of 10.1 billion pesos and total assets of 387 billion pesos, the prospectus showed. The bank currently has 1,097 branches in the country, according to the prospectus.
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