July and August proved busy months for financial institution acquisitions.
Some deals had been in the works for a long time. Itaú-Unibanco had been looking to shift its major risks insurance business for six months before it announced a deal with New York-listed Ace in early July.
Ace agreed to pay 1.52 billion reais ($685 million) for the acquisition of the property and casualty insurance business for large corporations in Brazil.
The deal, which is subject to regulatory approval, will make Ace the largest property and casualty insurer in Brazil, said Ace.
BTG Pactual, which first signaled interest in buying Generali’s Swiss private bank BSI in May, agreed the deal in mid-July. The 1.5 billion Swiss franc ($1.68 billion) acquisition will nearly double the Brazilian firm’s assets under management.
The deal came a few days after BTG Pactual agreed to buy property and casualty reinsurer Ariel Re from Global Atlantic. The price tag for the London and Bermuda-based property catastrophe reinsurer was undisclosed.
The Brazilian bank embarked on another acquisition a month later, saying it would buy the insurance business of Banco Pan for 580 million reais ($257 million). BTG Pactual owns 34.1% of Pan.
In Honduras, Banco Ficohsa said it was considering further acquisitions in Central America after closing the purchase of Citibank’s consumer banking business in the country. The deal, agreed in April, makes Ficohsa the largest bank in Honduras with a loan book of $2.7 billion.
In other sectors, US healthcare firm Abbott launched a tender offer in late August for the outstanding shares in Chilean pharmaceutical company CFR. Abbott has agreed to buy around 72.62% of CFR’s shares directly from the controlling shareholder, and said in May it would launch a public offer for the remainder. The public tender offer could be worth as much as $826 million.
The bid came shortly after UK pharmacy operator Alliance Boots closed its public tender offer for Farmacias Ahumada (FASA) on the Santiago Stock Exchange. Alliance Boots bought 99.39% of the 1.5 billion shares outstanding at 5.5162 Mexican pesos ($0.42) apiece, after striking a deal with Mexico’s Casa Saba, which owned FASA.
Brazilian food producer JBS has agreed to buy two poultry processing plants from Céu Azul Alimentos for 246 million reais ($111 million). It is buying the plants through Seara Alimentos, which is owned by JBS Foods.
Singaporean sovereign wealth fund GIC bought 18.5% of Brazilian education firm Abril Educação. The acquisition value was undisclosed but is likely to have come at around 600 million reais ($265 million), based on the company’s share price at the time.
Creditors to Lacteos Brasil (LBR) approved a bid from Parmalat to buy units producing cheese and long-life milk. Parmalat is to pay 250 million reais ($109.77 million) for the LBR units which had proforma revenues of 580m reais in 2013. The deal comes after years of negotiations: the pair was heard to be in discussion over a potential merger in 2011. Parmalat said a year ago that it would abandon talks to acquire LBR, as the “conditions for completing this transaction cannot be satisfied”.
Grupo Bio Pappel, which owns Mexico’s largest paper maker, agreed to buy rival firm Scribe. The target is valued at around $700 million, although Bio Pappel said that sum did not reflect the likely cost of the acquisition.
Norwegian fertilizer firm Yara is planning to expand its production capacity in Latin America organically and through acquisitions, after agreeing to buy a 60% stake in Brazilian company Galvani Indústria, Comércio e Serviços, for $318 million.
“If you look at our most recent acquisition, what that potentially does is also grow us on the upstream side, the production side,” Egil Hogna, Yara’s head of downstream, said. “We have a strong wish to develop and become an integrated company, becoming as strong in production as in distribution.” LF