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Santander to sell 5% stake in Brazilian arm to Qatar Holding

Spanish bank has agreed to sell a $2.7bn stake in its Brazilian arm

Spanish bank Banco Santander has agreed to sell a $2.7bn stake in its Brazilian arm to Qatar Holding, the government sovereign wealth fund. This transaction represents 5% of the share capital of Banco Santander Brasil.

Qatar holding will invest in Brazilian unit of Santander by subscribing a bond issue amounting to $2.71bn, mandatorily exchangeable for existing or for new shares of Banco Santander Brasil, at the choice of Banco Santander.

The bonds will mature on the third anniversary of the issuance date.

This investment represents the incorporation of Qatar Holding as a strategic partner of Grupo Santander in Brazil and in the rest of Latin America.
The transaction is expected to enable the Santander' Brazilian unit to have a free float of 25% by the end of 2014.

Banco Santander chairman Emilio Botin said, this agreement is the first step in the bank's relationship with Qatar Holding as a strategic partner in Brazil and the rest of Latin America. This investment will enhance the bank's diversification as well as the group's capital.