A Citigroup-led consortium has emerged as the victor in a year-long bidding war, with its $3.1 billion offer to acquire an 85.6% stake in China's Guangdong Development Bank.
Citigroup will have a 20% stake in the Chinese money-lending firm, along with two other Chinese firms, State Grid and China Life. IBM has also acquired a 4.74% stake.
Rivals in the bidding war for the 500-branch bank included several Chinese companies and France’s Societe Generale.
According to USA Today, Citigroup said that the deal marked the first time a foreign buyer was allowed to obtain significant ownership and assume a significant management role in a Chinese bank.
The group must now comply with the China Banking Regulatory Commission for permission to have a new shareholder.
The purchase of Guangdong Development Bank represents an important market growth opoprtunity for the US financial services group. Citigroup has recently been on an overseas acquisition spree, obtaining Turkey’s third largest lender for $3.1 billion and Central America’s largest credit card issuer for an undisclosed sum.