One of the best banking stories coming out of Latin America has just got better. The merger of Brazil’s investment firm BTG Pactual and Chile’s asset manager Celfin was officially announced in February, following on from initial discussions the two companies held in mid-2011. Once completed, the deal has the potential to create a leading regional investment banking group, with an additional presence in Peru and Colombia. The deal has seen BTG Pactual pay Celfin $245m plus shares equivalent to 2.4% of BTG's total capital.
The Brazilian bank has been considered for some time as one of the most promising firms in Latin America. BTG was set up by former UBS banker André Esteves, who then bought Banco Pactual back from UBS for $2.5bn, having sold it to the Swiss giant in 2006 for $3.1bn, when Mr Esteves was a partner at Banco Pactual. The deal created a sizable partnership-structured Latin American investment bank and created great expectations from foreign observers, which BTG Pactual has duly fulfilled.
