Citigroup sells its Mexican business via an IPO

Jane Fraser, CEO of Citigroup Inc., during an interview for an episode of “The David Rubenstein Show: Peer-to-Peer Conversations” at the Economic Club of Washington in Washington, DC, US, on Wednesday, March 22, 2023.

Valerie Plesch | Bloomberg | Getty Images

Citigroup on Wednesday announced plans to pursue an initial public offering from its Mexican company, Banamex, formalizing a long-telegraphed spinoff.

The bank expects to complete the separation in the second half of 2024, with a public offering likely to follow in 2025, it said. The company has not yet decided on a listing destination, but a dual listing in Mexico and the United States could be possible, a source familiar with the plans told CNBC.

“After careful consideration, we have concluded that the optimal path to maximizing Banamex’s value for our shareholders and advancing our goal of simplifying our business is to move away from our dual-track approach to focus solely on an IPO. company,” CEO Jane Fraser said. in a press release.

Citigroup bought Banamex for $12.5 billion in 2001. The bank first announced in 2022 that it would exit the company, which operates about 1,300 branches with more than 12 million retail customers and about 10 million pension fund clients. It has approximately 38,000 employees.

Citigroup shares fell about 1% in premarket trading on Wednesday.

—CNBC Leslie Picker contributed to this report.

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