Business NEWS

Spanish bank Santander raises $8bn in Brazil

By Elizabeth Haggar for CEOWORLD Magazine Updated:October 7, 2009

Spanish bank Santander (SAN.MC) announced that it had raised 14.1 billion Brazilian reais ($8.03 billion) from selling a roughly 16% stake in Banco Santander (ES:SAN) (STD).

Banco Santander Brasil (SANB11.SA) (BSBR.N) sold 600 million units at a price of 23.5 reais each.

The bank had filed to sell 525 million units, with each unit representing 55 common shares (SANB3.SA) and 50 preferred shares (SANB4.SA), but the offering was increased 75 million units to meet demand from investors.

But others see the new shares getting a good start and rising as much as two percent, thanks to the bright prospects for growth of banking services in Brazil.

Santander runs the third largest private-sector bank in Brazil by assets, with a 10.2 percent market share, behind Itau Unibanco (ITUB4.SA)(ITUB.N) and Bradesco (BBDC4.SA)(BBD.N).

The Santander IPO is the biggest ever in Brazil and ranks as the biggest in the world this year, ahead of the $7.34 billion IPO of China State Construction Engineering Corp., according to data from Dealogic.

The bank has invested heavily in Brazil over the last decade and wants to establish itself alongside the two major private banking titans Itau Unibanco and Banco Bradesco SA.

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