The CLDF passed a bill allowing BRB to purchase 49% of the common shares and 100% of the preferred shares of Master Bank, equivalent to 58% of the bank’s capital.
The next actions involve the approval of DF Governor Ibaneis Rocha, the completion of the application review by the Central Bank, the restructuring of Master Bank, and other terms specified in the acquisition agreement, as stated in the BRB statement.
The regulator of the banking system requires approval from the DF legislature for the operation to proceed.
The deal announced in March this year originally involved acquiring R$ 50 billion worth of Master assets along with shares. However, after negotiations with the BC, the assets acquired were reduced, and BRB will now only take half, which is R$ 25 billion.
The Master will have around R$50 billion in assets available for trading, including the R$25 billion from the BRB negotiation and another R$23 billion with low liquidity or restrictions.
Cade granted unconditional approval to the transaction between Master Bank and BRB in early June. As per the agreement, any assets not taken over by BRB will stay with Daniel Vorcaro, the current CEO and controlling shareholder of Master Bank.
Vorcaro agreed to invest R$2 billion (equivalent to $364 million) in the institution in June to convince regulators to authorize the merger.
The capital increase was a result of a negotiated agreement between the institutions and the BC. Some of the funds were generated through the sale of assets totaling R $ 1.5 billion that Vorcaro had for the BTG Pactual Bank in May. This included selling off a portion of approximately 48% in the retail company Veste, known for brands like Le Lis Blanc and Dudalina, which was previously owned by managers of the Master, WTN, and Trustee group.
