HSBC Holdings Regulatory News (HSBA)

27 Feb 2007 08:28

HSBC Holdings PLC27 February 2007 HSBC TO FURTHER STRENGTHEN LATIN AMERICA PLATFORM HSBC Holdings plc (HSBC) is seeking to increase its investment in El Salvador bylaunching public tender offers to acquire the interests of the minorityshareholders of Banco Salvadoreno, S.A. (Bancosal) and Inversiones FinancierasBancosal, S.A. (IFB). HSBC's acquisition of Grupo Banistmo S.A. (Banistmo) in November 2006established a significant platform across Central America, providing a fullrange of personal and commercial banking services through Panama's leading bank,Primer Banco del Istmo, and 106 other branches in Costa Rica, Honduras, Colombiaand Nicaragua. In addition it gave HSBC a 56.2 per cent stake in IFB, theholding company for Bancosal, one of El Salvador's leading financialinstitutions which operates through 62 branches in that country. HSBC, through majority-owned subsidiaries, will launch two public tender offersat a cost of up to US$190.7 million to acquire the outstanding shares of itsoperations in El Salvador, as follows: Banistmo will launch a tender offer on the El Salvador Stock Exchange for theoutstanding 58,245,037 common shares of IFB, representing 43.8 per cent of totalcommon shares in issue. Under the proposed offer, IFB's shareholders will beentitled to receive US$3 for each common share of IFB held. The proposed offerhas been unanimously approved and recommended by IFB's board of directors. This transaction is subject to certain conditions, including that at least 33.8per cent of the outstanding IFB shares be tendered, giving HSBC 90 per cent ofIFB. Simultaneously, IFB will launch a public tender offer for the 399,700outstanding minority shares of Bancosal, representing 4.94 per cent ofBancosal's total shares. Under the proposed offer, Bancosal shareholders will beentitled to receive US$40 for each Bancosal share. The proposed offer has beenunanimously approved and recommended by Bancosal's board of directors. Sandy Flockhart, Group Managing Director and President, HSBC Latin America andthe Caribbean, said: "El Salvador is a key developing country in the region.Increasing our investment in Banco Salvadoreno will benefit customers and deepensynergies with the HSBC Group worldwide, and particularly in Central America.Banco Salvadoreno is one of El Salvador's leading financial institutions andbanking franchises, with more than 120 years of banking history in that country,providing HSBC with a strong platform for growth." HSBC expects to complete the transactions by 31 March 2007. Notes to editors: 1. HSBC Holdings plc HSBC is launching these two public tender offers through Grupo Banistmo S.A.which is 99.97 per cent-owned by the HSBC Group. The HSBC Group serves over 125 million customers worldwide through some 9,500offices in 81 countries and territories in Europe, the Asia-Pacific region, theAmericas, the Middle East and Africa. With assets of US$1,738 billion at 30 June2006, HSBC is one of the world's largest banking and financial servicesorganisations. HSBC is marketed worldwide as 'the world's local bank'. 2. Inversiones Financieras Bancosal, S.A. Inversiones Financieras Bancosal, S.A. is the holding company which owns BancoSalvadoreno, Almacenadora Salvadorena (warehousing), Internacional de Seguros(insurance and bonding), Salvadorena de Valores (stock brokerage), Factosal(factoring) and BancoSal Inc (remittance business). IFB shares are listed on theEl Salvadorean Stock Exchange. HSBC, through its subsidiary Grupo Banistmo S.A.owns 56.2 per cent of IFB. At 31 December 2006, total assets were US$2.025 billion and equity was US$201.4million. 3. Banco Salvadoreno, S.A. Banco Salvadoreno, S.A., is one of the leading financial services companies inEl Salvador with more than 120 years in the market. It has a nationwide networkof 62 branches and 155 ATMs. Majority-owned by Inversiones Financieras Bancosal,S.A., Bancosal shares are listed on the El Salvadorean Stock Exchange. At 31 December 2006, total assets were US$1.989 billion and equity was US$203.1million. Bancosal provides a full range of financial services to more than500,000 customers in retail, commercial and corporate banking. This information is provided by RNS The company news service from the London Stock Exchange