CorpBanca Announces the Acquisition of Banco Santander Colombia, S.A. for $1.225B

CORPBANCA BCA has reached an agreement with Banco Santander, S.A. to acquire a 95% interest of Banco Santander Colombia SA the maximum allowed to an individual shareholder by the Colombian law. In addition, Corp Group Interhold S.A. (CorpGroup) -- the holding company through which the Saieh Group controls CorpBanca and other financial businesses -- will purchase at least a 2.85% stake (from the remaining 5% of the shares) which is held by other affiliates companies of BS. This operation includes "Santander Investment Securities Colombia S.A.", "Santander Insurance Agency Ltd." and "Santander Colombia S.A. Investment Trust", a stock brokerage, an insurance agency and a trustee, respectively. The operation is expected to be settled during the first half of 2012. With this acquisition, CorpBanca strengthens its growth strategy and becomes the first Chilean financial institution having a foreign bank subsidiary. The acquisitions made by CorpBanca and CorpGroup involves a total amount of up to US$1,225 million plus accruing interests of 180-days dollar LIBOR + 1% per year. The transaction is still subject to the approval of regulatory agencies in Colombia and Chile. CorpBanca's total investment in this transaction, US$1,155 million approximately, will be funded with own resources and a new capital increase of US$450 million approximately. CorpGroup will subscribe entirely its preemptive rights, and it is committed to acquire all shares not subscribed in the preferential offering period. Therefore, the Saieh Group will maintain the control of CorpBanca as well as its ownership percentage. CorpGroup currently holds the necessary resources to concur to this capital increase, and does not demand new funds from the market. Once this increase is executed, CorpBanca would have received more than US$830 million in fresh capital injections during the last six months.