Reuters

(Reuters)

Report: Santander Eyes CitiFinancial

By Industries FOXBusiness

Spain’s Banco Santander (STD) is reportedly mulling a joint bid for CitiFinancial, the consumer-finance unit put on the block by Citigroup (C).

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According to The Wall Street Journal, Santander is considering a “strategic” bid for CitiFinancial by teaming up with private-equity fund manager Warburg Pincus.

CitiFinancial, which is one of the companies Citi has deemed noncore, is also being bid on by a private-equity consortium that includes Blackstone (BX) and Carlyle, the paper reported. The next round of bids on the unit is due in a few weeks.

Bloomberg News reported BlackRock (BLK), the world’s largest money manager, is also eyeing CitiFinancial. However, BlackRock CEO Larry Fink told Bloomberg TV on Thursday if his company is involved in a deal for the business, it would be “on behalf of clients,” not for its own balance sheet.

Unlike many potential bidders that are private-equity funds, Santander would represent a “strategic” buyer. Santander has shown interest in Citi assets before, acquiring the New York bank’s portfolio of auto loans for $3.2 billion last year.

Citi is looking to get a bid equal to book value, about $2 billion, for CitiFinancial, which is one of the last two big businesses being auctioned by the company, the Journal reported.

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Encouraged by the deal talk, shares of Citigroup gained 1.5% to $4.67 Thursday. The stock had been down nearly 3% on the year as of Wednesday’s close.

 

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