Brazil’s PagSeguro nears US$3 billion deal to acquire Banco BV – newspaper report

RIO DE JANEIRO, BRAZIL – Brazilian financial technology company PagSeguro Digital Ltda is close to acquiring Banco Votorantim, known as BV, in a R$16 billion (US$3 billion) deal, financial news website Brazil Journal reported on Thursday.

Shares in PagSeguro fell over 13% in minutes after the Brazil Journal report was published.

PagSeguro did not immediately reply to a request for comment. Banco Votorantim declined to comment, and its shareholders Banco do Brasil and Votorantim Participacoes did not immediately respond to comment requests.

PagSeguro, which has a market cap of roughly US$18.5 billion on the Nasdaq, is principally a payments processor in Brazil. Its yellow credit and debit card machine is ubiquitous throughout the country.

BV, formally Banco Votorantim, is the seventh-largest bank in Brazil. It operates in the wholesale, retail, treasury, asset management, and brokerage fields, and was founded in 1988. Its headquarters are located in São Paulo, Brazil.

Read also: Brazil’s PagSeguro says it does not intend to acquire Banco Votorantim and has no signed agreement

The operations of Banco Votorantim are driven by a set of institutions that operate in an integrated way: the Bank provides businesses products and services for the commercial sector and investment, the BV Financeira operates in financing and consumer credit; Votorantim Asset Management (VAM) manages the resources of others, and Vototrantim CVTM does securities trading and brokerage.

Banco Votorantim is owned by Votorantim Group (Ermírio de Moraes family) and Banco do Brasil, after the operation completed on 28 September 2009. Banco do Brasil holds 49.9% of common shares and 50.1% of the preferred, Banco Votorantim maintaining control under the Votorantim Group.

BV  has a net worth of R$11 billion and about R$20 billion in interbank lines, which are given and renewed based on the credit perception of the institution and its controlling shareholder.

With information from Brazil Journal and Reuters