India’s Axis Bank has agreed to acquire Citigroup’s consumer business in the country for a consideration of around $1.6bn.
Under the terms of the agreement, Axis Bank will acquire Citibank India’s consumer businesses, including credit cards, retail banking, wealth management and consumer loans.
In addition, the Indian bank will also purchase the consumer businesses of Citi’s non-banking financial company, Citicorp Finance (India).
Citicorp Finance runs an asset-backed financing business, which includes commercial vehicle and construction equipment loans, along with a portfolio of personal loans.
Upon closing of the deal, around 3,600 employees working at Citi’s consumer businesses in India will be transitioned to Axis Bank.
The proposed acquisition is expected to close in the first half of the calendar year 2023, subject to certain customary closing adjustments and regulatory approvals.
Citi Asia Pacific CEO Peter Babej said: “Our announced transaction with Axis, a leader in Indian financial services, represents an important milestone for our franchise and offers an excellent opportunity to our consumer banking colleagues in India.
“As we move forward with this transaction, India remains a key institutional market for Citi. In line with our broader strategic repositioning, we will continue to support our institutional clients in this core market and across APAC, delivering the full power of our global network to enable their growth.”
Citi has been operating in India since 1902, serving the country’s large and mid-sized corporates, financial institutions and multinational companies.
Axis Bank said that the acquisition of Citi’s consumer businesses is a healthy strategic fit.
It is expected to benefit from Citibank’s large customer franchise, including credit card portfolio, wealth management clients, deposits, and a strong consumer lending portfolio.
Upon closing of the acquisition, Axis Bank is expected to have around 28.5 million savings accounts, more than 2.3 lakh Burgundy customers and 10.6 million cards.
With the proposed acquisition, it is enabled to consolidate its position as a large private lender, said the Indian bank.
Axis Bank MD and CEO Amitabh Chaudhry said: “We are delighted with the addition of an enviable retail franchise and a high-quality talent pool as we continue our journey towards becoming a premier financial services brand, in line with our GPS strategy framework.
“This is a significant milestone in Axis’ journey of growth and leadership and will bring in great value for all stakeholders.”
Axis Capital and Credit Suisse served as financial advisors and Khaitan & Co as legal advisor to Axis Bank on the transaction.
