Itau Unibanco Seeks Partner for Redecard

Roberto Setubal, CEO of Itau Unibanco, says his bank is seeking a strategic partner to invest in Redecard, the Brazilian credit card giant. But first, Itau Unibanco plans to raise its stake from just under 50% to a controlling position. Redecard appears to be on a dual track at the moment, as it is pursuing both a stake sale and a public share offering. The company filed Thursday plans with to sell an undisclosed number of shares. “We will participate in the follow-on to try and get a majority stake [in Redecard],” says Setubal on a call with analysts. “We’d like to have a strategic partner or even two to help give the company more support,” he adds, noting Redecard is a business to be shared. The CEO hints that a bank with a credit card business would make an ideal candidate. As part of an existing Redecard shareholder agreement, Itau and Unibanco have the right of first refusal for any new owner for the stake, says a Sao Paulo-based bank analyst at a sellside shop. In order to gain a controlling position, Itau Unibanco would only have to acquire another 5% or so of the company, he adds. It already has a call option on 24m shares, which is roughly 3.6%. Citi’s 17% stake is worth BRL2.72bn at Thursday’s closing price of BRL23.90.