Citi Securities and Fund Services, a division of Citigroup, Inc. (C) declared its foray into a strategic agreement with ING Groep NV (ING) to purchase its custody and securities services business. However, the provisions of the deal have not been revealed. Citi and ING expect to finalize the deal in the first quarter of 2014.
The transaction currently awaits regulatory approvals and clearances. It includes local custody and securities services businesses of ING, which are located in Slovakia, Hungary, the Czech Republic, Russia, Romania, Bulgaria, and Ukraine. Following the completion of this acquisition, the reach of Citi’s custody network will broaden to over 95 markets. Further, the company’s proprietary custody network will expand to 62 countries.
This deal will facilitate Citi to offer services related to comprehensive securities to its investors, intermediaries and issuers by strengthening its presence across the nation. Further, Citi’s clients will be able to access its global banking network. Moreover, this operation will assist customers to avail efficient processing and consistent services across various markets.
Citi’s Securities and Fund Services business division furnishes customized services to its institutional issuers, intermediaries and investors across different continents.
On the other hand, ING, a leading provider of custody services, which operates its business across seven Central and Eastern Europe (“CEE”) markets, currently represents €110 billion in assets under custody.
Recently, Citi entered into a definitive agreement with Best Buy Co., Inc. (BBY) to issue and manage cards under the latter’s brand in the U.S. The deal constitutes Best Buy’s home brand of cards. Additionally, Citi inked a deal with Capital One Financial Corp. (COF) to acquire roughly $7 billion of Best Buy’s private label and card loan portfolio. These agreements are expected to be completed in the third quarter of 2013, subject to customary closing conditions.
Citi currently carries a Zacks Rank #3 (Hold) while ING carries a Zacks Rank #4 (Sell).
More From Zacks.com
- Mergers, Acquisitions & Takeovers