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MeneameColombian conglomerate Colpatria would be interested in buying back the 49.7% stake GE Money holds in its banking unit and may use the stock market to finance the purchase, a spokesperson confirmed to BNamericas.
"In the case the US company decides to exit the business, Colpatria would be interested in buying," spokesperson Mario Alejandro Nieto said.
The General Electric (NYSE: GE) unit has built its stake in Multibanca Colpatria since 2007 through direct purchases and tender offers. GE Money has the option to buy up to another 25% in the bank through 2012.
But the financial arm of GE has moved to reduce its investments in the banking sector after being hit hard by the recent financial crisis.
In July, GE's financial arm sold Central American financial group BAC-Credomatic to Colombia's biggest banking holding Grupo Aval for US$1.9bn. The company also sold its GE Money operations in Argentina, which focused on consumer finance.
The agreement between GE and Colpatria includes a clause where the US firm could not sell part of its stake to a third party, so a repurchase from Colpatria is feasible in the short term, local brokerage Interbolsa said in a report.
Colpatria expects to close an agreement with GE in six to nine months, the group's president Eduardo Pacheco told Colombian daily Portafolio.
IPO AHEAD?
To finance the purchase of the 49.7% stake, Colpatria may look to re-enter the Colombian stock market BVC, from which it was delisted after the deal with GE Money, Nieto said.
"The recent success in Davivienda's issuing may be the starting point for another IPO in Colombia," Interbolsa's report reads.
Last week, local bank Davivienda held its IPO in the Colombian stock market, issuing 26mn preferred shares for a total of 416bn pesos (US$227mn). Investor demand hit 12 times the offer. The IPO was first in the local market since 2007, when Helm Bank floated a 15% stake.
Mercantil Colpatria ranks as the eighth bank by asset size in the sector, with a roughly 4% market share as of June 2010, according to figures from financial regulator Superfinanciera.
Colpatria is a conglomerate with some US$5.5bn in assets that also operates in the insurance and construction businesses, among others.
E-mails sent by BNamericas to GE press officers were not answered.
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