Citigroup ( NYSE: C ) is close to selling Banamex, its Mexican consumer bank, in a deal that could value it for as much as $8B, the Financial Times reported Monday, citing people familiar with the matter.
Germán Larrea, the billionaire owner of Mexico's largest mining company company Grupo Mexico, is in exclusive talks to buy Banamax, three people told the FT . His offer is likely to value Banamax at $6B-$8B, depending on the deal's structure, and well below the $10B or more that some bullish analysts had expected.
The sources warned that while the talks are advanced, there's no guarantee that a deal will be reached. A bid by Mexican bank Banca Mifel, with support from Apollo Global Management ( APO ) had reached the later stages of negotiations, but Citi ( C ) decided to continue with the Larrea bid, they said .
Two of the people said Grupo Mexico and Citi ( C ) were considering a structure where the U.S. bank keeps a stake in Banamex until it could later sell it through an initial public offering, a development that Bloomberg had reported earlier.
Citi ( C ) had decided to sell Banamex in January 2022. It's part of a larger plan by CEO Jane Fraser to pare down its consumer banking operations to focus on four wealth centers and exit 13 markets .
The company didn't immediately respond to a request for comment.
In 2017, Citigroup ( C ) agreed to pay ~$97M to settle a criminal investigation into violations of anti-money laundering rules and the Bank Secrecy At at the company's Banamex US unit , which Citi had decided to shut down in 2015.
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Citigroup in advanced talks with Grupo Mexico for sale of Banamex - report