International banking giant Citigroup has reportedly placed a $10.75 billion bid for a majority share in the Japanese brokerage firm Nikko Cordial Corp, which has recently been hit with an accounting scandal.
At present, Citigroup owns a 5% stake in the Tokyo-based company and hopes to raise this stake to at least 50%. According to the Financial Times, Citigroup will offer JPY1,350 for each share it does not already own, which will equate to $10.75 billion.
If successful, Citigroup will gain an additional 109 branches, JPY30 trillion of client assets and approximately 12,000 employees in Japan, Bloomberg stated. The transaction will also secure the future of the Japanese broker after the group suffered from accounting-related losses.
Both parties already have a strong relationship and operate an investment banking joint venture.
Shares of Nikko Cordial have soared by 14% following the bid speculation.