Santander on Acquisition Spree - Analyst Blog

Spain’s Banco Santander SA (STD) is on an acquisition spree. According to a report in Financial Times, the company has a number of acquisitions lined up in both the U.S. and the U.K.

 

The Spanish banking giant is set to acquire 318 branches from the Royal Bank of Scotland Group plc (RBS) in the U.K. Additionally, the company is also planning to buy $4.3 billion of car loans from HSBC plc (HBC) in the U.S. Santander is also rumored to be in talks with M&T Bank (MTB) to sign a deal for merging their U.S. operations.

 

The financial crisis was a blessing in disguise for Santander, which has been busy acquiring assets for a cheaper price over the past two years. The company has added several businesses in the Continent and America. In the U.K., Santander acquired Alliance & Leicester and parts of Bradford & Bingley during this period. In Germany, the company added the consumer finance business of Royal Bank of Scotland and General Electric Co. (GE).  

 

Earlier in July, Santander struck a deal for the acquisition of the Swedish company Skandinaviska Enskilda Banken AB’s retail banking network in Germany for €555 million ($701 million). This deal is part of Santander’s efforts to become a full-service retail bank in Germany. The acquisition adds 173 new branches, doubling Santander's number of outlets in Germany.

 

To boost its market share in Mexico, Santander has recently announced the buying back of its 24.9% stake in its Mexican arm, Grupo Financiero Santander, from Bank of America Corp. (BAC) for $2.5 billion. 

 

These acquisition deals are in line with strategic reengineering efforts at Santander. Its home market is experiencing a deep recession. Geographic diversification, therefore, remains an obvious choice for the company.