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Santander Holdings USA Inc. will pay approximately $2.5 billion to acquire the outstanding shares of its auto loan business, making it a wholly owned subsidiary.
The Boston-based parent organization of Santander Bank and its other U.S. companies said in a statement yesterday that it has entered into a definitive agreement with Santander Consumer USA Holdings Inc. to acquire all outstanding shares of common stock of Santander Consumer USA not already owned by Santander.
Santander currently owns approximately 80 percent of Santander Consumer’s outstanding shares of common stock. The transaction will involve an all-cash tender offer for $41.50 per share, followed by a second-step merger, which will make Santander Consumer USA a wholly owned subsidiary of Santander.
The offer price represents a 14 percent premium to the closing price of Santander Consumer’s stock of $36.43 as of July 1, the last day prior to Santander’s announcement that the company had offered to acquire the remaining outstanding shares. When the deal was proposed on July 1, the offer called for the remaining shares to be acquired for $39 per share in cash, which Santander said represented a 7.4 percent premium.
The boards of directors of both Santander and Santander Consumer have unanimously approved the transaction. The transaction is expected to close in the fourth quarter and is subject to regulatory approval by the Board of Governors of the Federal Reserve System. The deal is not subject to shareholder approval.
