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Julius Bär banks on Argentina for expansion: Reuters
Posted on Friday, 19 May 2017 09:49
Julius Bär is on the verge of acquiring a fifth of Argentine financial group TPCG, Reuters reported, as the global Swiss private bank seeks to expand in the country now the currency regulations which curbed foreign investment have been lifted.
A source familiar with the situation told the news provider the European suitor wants to use the purchase as a springboard for growth in Latin America, though future plans in the region depend on the success of president Mauricio Macri’s reforms.
Discussions are at an advanced stage and an announcement could come as early as next week, but the person added the usual caution there is no guarantee the talks would lead to a final agreement.
Switzerland’s largest standalone private bank is also likely to have an option to increase its holding over time, which is similar to its investment in Brazilian wealth manager GPS Investimentos Financeiros e Participações.
In a bid to drive expansion abroad, it bought an initial 30.0 per cent stake in the Latin American company in 2011 and later took a further 50.0 per cent to ramp up its overall ownership to 80.0 per cent.
While the value of this latest possible investment is not known, Reuters suggested it would be priced at 1.0 per cent to 2.0 per cent of TPCG’s assets under management, being the typical basis of private banking acquisitions.
The Buenos Aires-based brokerage is mainly focused on the Argentine and Uruguayan fixed income and equity markets and its client base comprised mutual and hedge funds and financial institutions, among others.
Bloomberg first reported TPCG is willing to hand over a minority stake to a foreign partner now the country has re-opened to foreign investment after more than a decade of exchange controls and state intervention.
At the beginning of the month, co-founder and managing director Ileana Aiello told the news provider: "The plan would be sell a stake to a foreign partner to later become together bidders on some small, local brokerages.
"Our ideal candidate is someone bringing a name, technology and capital that helps us to become an AAA rated company, a full-fledged broker-dealer with the capacity to offer every product to our clients."
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