(Corrects to clarify Bloomberg reported the talks on Wednesday,
not Tuesday)
By Andres Gonzalez
May 10 (Reuters) - Conglomerate Grupo Mexico is set to buy Citigroup Inc's retail banking
operations in Mexico for about $7 billion in a deal that could
be announced as early as this week, according to a person
familiar with the matter.
As part of the deal, Citi will retain a roughly 10% stake in
the Banamex unit, the source said, requesting anonymity as the
discussions are confidential.
Citi could choose to sell the stake to Grupo Mexico, which
is controlled by billionaire German Larrea, or other potential
buyers in the future, the source said. Another option could be
to list the stake on public markets, the source added.
Reuters had reported in February that Grupo Mexico's
proposed deal for Banamex could value it at $7 billion or more.
Citi declined to comment. Grupo Mexico did not immediately
respond to a request for comment.
Citi announced plans to offload the unit more than a year
ago as part of an effort from Chief Executive Officer Jane
Fraser to sell some international operations to simplify its
business.
Over the past year, Citi has exited and sold some retail
businesses in several countries across Asia and other parts of
the world.
Several other potential buyers, including fellow Mexican
billionaire Carlos Slim dropped out of the auction process to
buy Banamex, according to the source.
The business also attracted the interest of foreign
competitors with operations in Mexico such as Banco Santander , the source said.
Bloomberg reported on talks advancing between Grupo Mexico
and Banamex earlier on Wednesday.
(Reporting by Andres Gonzalez in London, additional reporting
by David French, Saeed Azhar and Isabel Woodford; Editing by
Anirban Sen and Jamie Freed)
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