Citigroup Inc. agreed to sell a 25% stake in its Mexican retail banking unit Banamex to local businessman Fernando Chico Pardo as part of a plan to list the asset publicly.
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Chico Pardo — via a company owned by the executive and his family — will acquire the stake for about $2.3 billion, Citigroup said in a statement. When the deal closes, as expected in the second half of next year, Chico Pardo will become chair of Grupo Financiero Banamex, according to the statement.
New York-based Citigroup had been courting wealthy investors to buy a chunk of Banamex that could be built into a controlling stake after a plan to sell the unit outright fell apart, Bloomberg has reported. Chief Executive Officer Jane Fraser met last month in Mexico with President Claudia Sheinbaum to discuss plans for the business.
Fraser reiterated in July that a Banamex IPO could stretch into 2026 as the bank navigates regulatory approval and market conditions. She said then that the unit is now growing faster than peers with the consumer business expanding at double-digit rates.
The stake being acquired by Chico Pardo represents about 520 million Banamex shares, according to the statement. In connection with Chico Pardo's bid, Citigroup incurred a goodwill impairment charge of about $726 million which has been recorded in the bank's third-quarter expenses and is capital neutral to the bank, it said.
Chico Pardo is the former chief executive officer of Carlos Slim's Grupo Financiero Inbursa and founder of private equity firm Promecap. He's also a major shareholder in Grupo Aeroportuario del Sureste, or Asur, which operates in the lucrative region that includes tourist hotspots like Cancun. The company in April approved a dividend to shareholders. Analysts at Bradesco said in a note that the move could hand Chico Pardo more than $300 million.
The executive previously worked for Salomon Brothers and Standard Chartered, according to his Asur profile. He set up Promecap in 1997.
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