Bloomberg reports: Citigroup Inc., the world’s biggest financial services company, will borrow 950 billion yen ($8 billion) to reduce currency risk on its bid for Nikko Cordial Corp., according to two bankers with knowledge of the financing.
Mizuho Financial Group Inc. will lend 350 billion yen to Citigroup, which has bid $13.4 billion for Nikko Cordial, Japan’s third-largest brokerage, said the bankers, who declined to be identified because of confidentiality agreements. Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. will lend 300 billion yen each, the bankers said.
The loan “will help us better match the currency requirements of the recently announced Nikko Cordial transaction,” Atsuko Yoshitsugu, a Tokyo-based spokeswoman at Citigroup, said in a statement e-mailed to Bloomberg News.
Citigroup’s banking unit, Citibank Inc., as well as Japan’s three largest banks, are arranging 1.7 trillion yen of loans, the Nikkei newspaper reported without saying where it obtained the information. That would be the biggest syndicated loan in Japan, Nikkei said.
“This yen loan facility, which is for general corporate purposes, is part of Citigroup’s global borrowing program,” said Yoshitsugu. She declined to give details of the amount.