Actis, an emerging markets private equity investor, has acquired a minority stake in XP Investimentos, Brazil’s largest independent brokerage firm, through a capital injection of USD58m.
Actis will work with XP to prepare it for an IPO. The transaction is subject to approval by the Brazilian Central Bank.
XP Investimentos has the largest capital markets educational programme in Brazil. More than 300,000 people have been trained by XP in topics ranging from investment basics to advanced portfolio management strategies.
This is the third investment by Actis in Brazil in the last three months. Actis invested USD58m in Brazilian supermarket chain Companhia Sulamericana de Distribuição in September 2010; and USD53m in Gtex Group, a cleaning products manufacturer, in October 2010.
Actis’s investment in XP will be made from its USD2.9bn fund, Actis Emerging Markets 3.
XP started operations in 2001 and currently has over 70,000 customers and 215 branches in more than 100 Brazilian cities.
In addition to brokerage and education, the XP group also includes an asset management company with more than USD350m under management and an insurance broker.
Guilherme Benchimol, general manager of XP, says: "Our vision is for XP to become Brazil’s largest ‘financial shopping centre’. In Brazil today, universal banks dominate the market and mostly limit their offering to their own products. Our independent status enables us to offer all our customers, in one place and with low minimum tickets, access to stock exchanges, mutual funds, bonds, pensions, insurance and any other financial product."
Actis plans to support XP in the preparation of an IPO, to become the first publicly traded company in this sector in Brazil.
Paul Fletcher, senior partner at Actis, says: "This partnership consolidates Actis’s position as one of the most active private equity investors in Brazil, further strengthening our ability to make future investments in the region.”
