TORONTO – Scotiabank (TSX:BNS) says it will acquire a 51 per cent interest in the credit card and consumer loans business of Cencosud SA, the largest retailer in Chile, in a deal valued at $300 million.
The transaction includes a 15-year partnership between Scotiabank and Cencosud.
The financial services arm of Cencosud will continue to operate as a standalone business, with oversight from a board of directors representing the two partner companies.
The transaction will make Scotiabank the third-largest credit card supplier in Chile, one of the countries that it has identified as an area of growth.
Scotiabank chief executive Brian Porter told shareholders in April that the bank wants to sharpen its focus in Peru, Colombia, Mexico and Chile.
Cencosud is a retail conglomerate operating in five countries, including Argentina, Brazil, Peru and Colombia and its financial service arm currently has 2.5 million credit cards with more than US$1.2 billion in Chile.
“Scotiabank is excited about this acquisition because it will strengthen our credit card offerings for our customers and attract new customers to the bank,” said Wendy Hannam, Scotiabank’s executive vice-president for Latin America.