Banco Santander to buy Canada’s Carfinco for $269M

MADRID – Banco Santander SA, Spain’s biggest bank and parent of Santander Bank, agreed to buy Canadian car-financing company Carfinco Financial Group Inc. for about C$298 million ($269 million).

Santander will pay C$11.25 per share, representing a premium of 32 percent on the share price over the past 90 days of trading, the Santander, Spain-based lender said in a statement Tuesday. Carfinco shares jumped as much as 33 percent to C$11.42, giving it a market value of C$302.6 million.

“We are excited to sign this agreement with Carfinco, which allows us to enter a market with good growth potential such as Canada, where we hope to reach agreements with other car manufacturers like those we have signed in other countries,” said Juan Rodriguez Inciarte, senior executive vice president and head of strategy at Banco Santander.

Santander said it expects to complete the transaction in the second half of this year, pending regulatory approval. The impact of the purchase is “not significant” on the group’s shareholder equity, according to the statement.

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The Spanish bank will own about 95 percent of the new company that will be formed after the transaction is completed. Carfinco executives, including President and CEO Tracy Graf, will retain 5 percent and maintain their management roles, according to Santander.

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