Bank of Nova Scotia reaches stake acquisition agreement with Grupo Said

The transaction is valued at approximately $1.3 billion

Bank of Nova Scotia reaches stake acquisition agreement with Grupo Said

Bank of Nova Scotia has announced that it has entered into an agreement with Grupo Said to acquire the Chilean holding firm’s 16.8% stake in Scotiabank Chile.

The stock and cash deal is valued at roughly $1.3 billion, and it is expected to increase BNS’s ownership share in Scotiabank Chile to 99.8%, Reuters reported.

BNS estimated that the acquisition of the stake would add approximately $35 million per quarter to its earnings. The bank added that this extra volume would be immediately accretive to its earnings per share.

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“On closing, the bank will pay CA$650 million in cash and issue seven million shares to Grupo Said impacting Scotiabank’s Common Equity Tier 1 capital ratio by approximately 10 basis points,” BNS said in a statement with regulators.

Grupo Said will become a significant shareholder in BNS, along with keeping seats on and the presidency of Scotiabank Chile’s board, Scotiabank added.

“[This] announcement enables us to achieve even greater scale and deliver the highest value for customers, further strengthening our position as a leading bank in the Americas,” said Brian Porter, CEO of BNS. “Our long-standing relationship with the Said family will remain a significant benefit to us as we build on our momentum in Chile over the coming years.”

Regulatory bodies have yet to approve the deal as of press time.