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Santander Consumer eyes $8.4B valuation in IPO

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January 10
1:33 AM 2014

Dallas-based Santander Consumer USA Holdings Inc. is seeking a valuation of up to $8.4 billion in an initial public offering as its private equity stakeholders cash out. Santander Consumer is the consumer-finance arm of Spanish lender Banco Santander SA.

According to Reuters, Santander Consumer said it expected the IPO to raise up to $1.56 billion, based on the sale of 65.2 million shares priced at $22 to $24 each. Santander Consumer focuses on auto loans.

Shareholders including Banco Santander will sell all of the shares being offered. Santander Consumer, in a filing with the US Securities and Exchange Commission, said it will not receive any of the proceeds, the report stated.

Santander Consumer is 65% owned by its Spanish parent. An investment vehicle owned by private equity firms Centerbridge Partners, KKR & Co. and Warburg Pincus owns about 25% stake, which it acquired for $1 billion in 2011, Reuters said.

The offering will reduce the fund's holding to about 10%. It will sell about 80% of the shares in the IPO, while Banco Santander will sell the rest. Santander Consumer chief executive Thomas Dundon owns 10% of the company and will retain his stake, the report said.            

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