Tags: Santander | US | car | IPO

Santander Considers IPO of US Car Financing Unit

Friday, 23 Nov 2012 09:37 AM

 

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Spain's Santander is considering a listing of its car financing division in the United States as it spins off overseas businesses to shore up its balance sheet against weakness in Spain caused by the country's economic slump.

A listing is envisaged in deal signed last year with other shareholders in the Fort Worth, Texas, unit, a spokeswoman for Santander told Reuters.

"The IPO of Santander Consumer USA is included in the shareholders' agreement signed in October 2011 with our partners," the spokeswoman said.

Santander retains control of 65 percent of SCUSA through a holding company, while KKR & Co., Warburg Pincus,and Centerbridge Partners have a combined 25 percent stake. The remaining 10 percent belongs to Dundon DFS.

The spokeswoman said it was too early to talk of a timing for the initial public offering of SCUSA and that the valuation would depend on the share price at the time of the sale.

The Wall Street Journal reported on Wednesday Santander, which raised $4 billion in a U.S. listing of its Mexican banking business in September, was planning an offering of the car financing unit for the first half of 2013.

The business could be worth as much as $6 billion although plans are still in the early stages, according to the WSJ.

Santander has already listed its Brazilian and Chilean arms and its Argentine and British businesses are expected to follow.

The bank has weathered Spain's property market crash and sovereign debt crisis better than its rivals because it makes less than a fifth of its profit in the country after years of expansion abroad into regions such as Latin America.

Spain became the focal point of the euro zone debt crisis earlier this year as it became clear its banks would need financial support to rid their balance sheets of around 185 billion euros of toxic real estate assets.

© 2014 Thomson/Reuters. All rights reserved.

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