Toronto-based Bank of Nova Scotia continues to expand its footprint in Latin America, with a plan to acquire a 51% controlling interest Peru’s Banco Cencosud for approximately $130 million.
The agreement, which is subject to regulatory approval, will make Scotiabank the second-largest credit card issuer in the South American country.
The deal will see the two companies enter into a 15-year partnership to manage the credit card business and “provide additional products and services to customers,’’ according to a Scotiabank statement.
The company says Cencosud is the second largest supermarket and fourth largest department store chain in Peru, and its banking branch has more than 315,000 clients.
Scotiabank first established a presence in Peru in 1997, and it now has more than 10,000 employees across 310 branches in the country.
The company operates in 11 countries across Latin America, with a particular focus on Mexico, Peru, Chile and Colombia.
In January, the lender announced a deal to buy Citibank’s consumer and small and medium enterprise operations in Colombia for an undisclosed amount.
In December, Scotiabank said it had secured a deal to buy a 68% stake in a Chilean banking operation, BBVA Chile, for $2.9 billion.
This latest acquisition in Peru is on strategy and won’t impact Scotiabank’s bottom line, or its capital position, says Toronto DBRS Ltd. in a news release.
DBRS says it views the transaction as, “consistent with [Scotia’s] stated acquisition strategy of expanding its scale in the Pacific Alliance region, which it has communicated to the market over the past several years.”
With files from James Langton