Brazilian private lender Itau Unibanco has signed a deal to buy a 35% stake in regional brokerage firm Avenue Holding Cayman for approximately $92m (BRL493m).
The deal consideration includes a cash injection of BRL160m and a secondary share purchase.
The Brazilian lender is eyeing the controlling stake in Avenue and intends to acquire an additional 15.1% stake in the firm after two years from the closing date of the first tranche.
Following the additional stake purchase, Itau will hold 50.1% of the total and voting capital in Avenue, which offers Brazilians access to foreign markets.
The SoftBank-backed brokerage owns a US-based digital securities broker and currently has more than 229,000 active clients and BRL6.4bn under custody.
Itaú said that the deal aligns with its recent initiatives, including the acquisition of Ideal Corretora and the launch of the Íon platform. It forms part of the bank’s strategy to establish an investment ecosystem to offer products and services through ‘most convenient channels for each customer’.
Additionally, Avenue’s investment intermediation services offered through Itaú Unibanco’s distribution franchise and client base is expected to broaden access to the foreign investment market while enhancing the functionality of opening an international current account.
The deal will also help Itau to diversify its products and services globally through a streamlined self-service experience and allow it to tap the talent and expertise of the Avenue’s team.
Avenue’s operation and management will remain separate from Itaú Unibanco following the close of the deal, which is awaiting regulatory approvals.
Last week, Itaú appointed Percy Moreira as its head of Itaú USA and private international to lead the wealth management offshore operation of Itau Private.