Citigroup made a $10.75 billion (€8.2 billion) takeover bid for Japanese brokerage Nikko Cordial today by offering cash to the scandal-hit firm's shareholders.
Citigroup, the largest US bank but a small player in Japan outside of corporate investment banking, said it would pay a premium to Nikko's closing price today to lift its stake in Japan's third-largest securities firm from just under 5 per cent to at least 50 per cent.
Citigroup said it would offer 1,350 yen for each Nikko share and that acquiring all of the broker's stock would cost about 1.253 trillion yen.
Shares in Nikko, a broker that has been weakened by an accounting scandal at its merchant banking arm, jumped 14 per cent to 1,340 yen before the announcement on news that Citigroup was poised to bid.
Citigroup and Nikko share control of an investment banking joint venture, Nikko Citigroup, and Citigroup had owned as much as 25 per cent of Nikko Cordial after bailing the brokerage out during a financial crisis in 1998. It has since sold most of its holding.
Nikko Cordial said its board of directors had approved Citigroup's offer.