EFG confirms it's in talks with BTG Pactual on BSI purchase

[ZURICH] EFG International AG said it's in exclusive talks with Brazil's Grupo BTG Pactual SA to buy its Swiss bank BSI AS, a deal that would double its assets under management.

EFG, the Swiss private bank controlled by billionaire Spiro Latsis and his family, said it was responding to media reports that company is in exclusive talks with BTG Pactual and that a decision is imminent, the firm said Friday in an e-mailed statement. "No decision has been made," the bank said.

The Brazilian bank has been shedding assets to raise cash after the arrest of then-Chief Executive Officer Andre Esteves in November amid a widespread corporate corruption scandal that sent its bonds and shares into a tailspin. After losing almost half their value over the course of 2015, shares have rebounded 12 per cent this year.

Zurich-based EFG oversaw 80 billion francs for clients at its banks in Europe, Asia and the Caribbean at the end of June while BSI had about 82 billion francs in assets under management.

Under the agreement that's being discussed, BTG would retain a 20 per cent to 30 per cent stake in the combined entity, Reuters reported earlier, citing a source it didn't identify. A deal could be announced as soon as next week, Reuters said.

BTG's Esteves, who has since been released from jail and is under house arrest, has denied any wrongdoing through his lawyers.

BTG completed the acquisition of BSI from Italy's Assicurazioni Generali SpA for 1.25 billion Swiss francs in September.

BLOOMBERG