NEW YORK (AP) - Citigroup Inc. , the nation's largest financial institution, said Tuesday it has agreed to buy a 20 percent stake in the Turkish bank Akbank for about $3.1 billion.
Citigroup said Akbank is a full-service retail, commercial, corporate and private bank in Turkey, with assets of $35.8 billion, making it the third-largest in Turkey. Its loan portfolio is valued at $17.7 billion, and its deposit base at $22.7 billion.
The deal is subject to shareholder and regulatory approvals and is expected to close in 60 days to 90 days, Citigroup said.
Citigroup shares fell 10 cents to close at $50.05 on the New York Stock Exchange.
Citigroup said Sabanci Holding, a 34 percent owner of Akbank shares -- together with its subsidiaries, which own an additional block of shares in Akbank -- have granted Citigroup a right of first refusal or first offer over the sale of any of their Akbank shares in the future.
In addition, Citigroup has granted a right of first refusal or first offer over its Akbank shares to Sabanci, Citigroup said.
Citigroup said the deal also establishes a strategic collaboration between Citigroup and Akbank to pursue new commercial activities, referral arrangements and joint ventures.
The terms also grant Citigroup the right to appoint one non-executive director to Akbank's nine-person board, and the Sabanci Group the right to appoint one non-executive director to the board of Citigroup's Turkey subsidiary.
Citigroup has had operations in Turkey since 1975; its holdings constitute the 19th largest bank in Turkey with assets of about $2.1 billion and deposits of $1.6 billion.
Citigroup's Press Release
Source: Associated Press