30 March, 2010

Brazil Bank Mergers & Acquisitions (Unibanco Holdings)

The Unibanco booth at the International Art Fair of São Paulo in 2008.

Photo credit: ArtExplorer.

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Unibanco Holdings S.A.

[Unibanco Holdings was acquired by Banco Itaú Holding in 2008.]

Unibanco's predecessor, Casa Moreira Salles was founded in 1924 in southern Minas Gerais when local prominent merchant João Moreira Salles was granted a banking charter. The banking department became a formal bank named Casa Bancária Moreira Salles in 1931.

In 1940, Casa Bancária Moreira Salles merged with two other banks to form the Banco Moreira Salles. In 1941, a branch was opened in Rio de Janeiro, followed by another one in São Paulo. By 1945, Banco Moreira Salles had built a network of 63 branches.

In 1966, Banco Moreira Salles joined up with partners Deltec, Light & Power Co. and the Azevedo Antunes Group to form Banco de Investimento do Brasil (BIB), which specialised in the equity underwriting segment.

In 1967, Banco Moreira Salles and Banco Agrícola Mercantil do Rio Grande do Sul (Agrimer) merged and changed its name to União de Bancos Brasileiros, S.A. or UBB. In 1970, the bank acquired Banco Predial in Rio de Janeiro, a bank that specialized in consumer loans for low-income clients. Between 1972 and 1974, UBB bought out BIB’s minority shareholders and took full control of the bank. To unify its brands and marketing effort, the 15 financial institutions under the UBB umbrella were renamed Unibanco in 1975.

In 1983, Unibanco’s insurance subsidiary Unibanco Seguradora merged with insurer Sul América to form Sul América Unibanco Seguradora, combining Sul América’s industry leading products with Unibanco’s expansive branch network.

Recent transaction(s):
  • In 1995, Unibanco acquired the banking operations of Banco Nacional S.A., an insolvent bank that had been under state administration. The purchase increased Unibanco's branches to more than 1,400 nationwide.
  • In 1996, Unibanco acquired 50% of Fininvest, a specialist in consumer finance.
  • In 1998, Unibanco bought 50% of Banco Dibens, a bank that specialized in automobile financing.
  • In 2000, Unibanco acquired the remaining 50% interest in Fininvest for USD $245-million. Fininvest had 3 million clients and was one of Brazil's leading consumer finance companies.
  • Also in 2000, the bank acquired a majority stake in Credibanco from the Bank of New York for BRL 150-million. Credibanco was a small bank but a well-known asset manager.
  • Also in 2000, the bank acquired Banco Bandeirantes for BRL 1.2-billion from Portugal’s state-owned Caixa Geral de Depósitos, strengthening Unibanco's operations in São Paulo and northeastern Brazil. Banco Bandeirantes had about 500 offices in Brazil.
  • In 2003, Unibanco acquired Creditec, strengthening the bank’s consumer credit market share.
  • In 2004, the bank acquired HiperCard from Dutch supermarket chain Koninklijke (Royal) Ahold NV. HiperCard was a private-label credit card issuer in northeastern Brazil with over two million cardholders.
  • Also in 2004, the bank bought Banco BNL do Brasil from Italy’s Banco Nazionale del Lavoro. Financial terms were not disclosed.
  • In 2005, Unibanco acquired the rest of Banco Dibens.
  • In 2008, Banco Itaú Holding acquired Unibanco Holdings to form Brazil and Latin America’s largest bank. The deal was valued at BRL 26.5-billion (USD $12.3-billion). Existing Itaú shareholders would own 66% of the new entity, to be known as Itaú Unibanco Holding S.A., with Unibanco’s shareholders owning the rest. The combination was said to have been spurred by Banco Santander’s purchase of ABN AMRO Banco Real in 2007. Itaú Unibanco would leapfrog state-owned Banco do Brasil to become the nation’s largest bank with 4,800 branches and 30,000 ATMs serving 14.5-million clients.

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