Citigroup has reached a definitive agreement to acquire the subsidiaries of Grupo Cuscatlan from Corporacion UBC Internacional, the subsidiaries’ holding company with 2,500 shareholders, for USD1.51 billion in cash and stock. Grupo Cuscatlan, with operations in El Salvador, Guatemala, Costa Rica, Honduras and Panama, is one of the leading financial groups in Central America.
Citigroup will acquire Grupo Cuscatlan’s banking and financial intermediaries, including pension and insurance operations in El Salvador. This transaction will further expand Citigroup’s corporate and retail operations in the region and complement its pending acquisition of Grupo Financiero Uno, the largest credit card issuer in Central America.
Operating under the Banco Cuscatlan trademark, Grupo Cuscatlan subsidiaries offer corporate and commercial banking products and services, as well as a growing suite of consumer banking products. The group has USD5.4 billion in assets, USD3.5 billion in loans, USD3.4 billion in deposits as of 30 September 2006. The company has highly regarded and strong corporate relationships throughout Central America. Grupo Cuscatlan currently serves more than 45,000 corporate clients and 1.2 million consumer clients through a distribution network of 202 branches and 263 ATMs throughout the region. It has approximately 5,000 employees.
“The acquisition of Grupo Cuscatlan is another significant step in expanding Citigroup’s businesses in Latin America,” says Charles Prince, the Chairman and Chief Executive Officer of Citigroup. “This transaction complements our recent acquisition of Grupo Uno and, taken together, these transactions quickly and significantly strengthen our distribution capabilities and product offerings to serve retail and corporate clients in Central America.”
“Grupo Cuscatlan’s management team and business model have produced excellent results on a consistent basis in recent years,” adds Manuel Medina-Mora, the Chairman and Chief Executive Officer of Citigroup Latin America & Mexico. “We are delighted to welcome Grupo Cuscatlan and its team of professionals to Citigroup. We are confident that Grupo Cuscatlan and its employees will help us to continue delivering high-quality, innovative products and services to individual and institutional clients throughout Central America.”