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Qatar wealth fund sells 2.5% stake in Santander Brasil for 2.3B reais

Qatar Investment Authority sold a roughly 2.5% stake in Banco Santander (Brasil) SA, pricing both an offering of 80 million units as well as an overallotment option for up to an additional 12.0 million units at 25 Brazilian reais per unit.

The stake sale through unit Qatar Holding LLC, which generated 2.3 billion reais for the sovereign wealth fund, simultaneously consisted of a secondary unit offering in Brazil, along with an offering of units in the form of American depositary shares outside of Brazil.

Each unit consists of 1 common share and 1 preferred share in the Banco Santander SA unit, the Brazilian subsidiary said in a Form 6-K filed April 6.

Within the global offering, 22 million units were allocated for the Brazilian offering while 58 million American depositary shares were allocated for the international offering.

The settlement of the global offering, without considering the additional units of the international offering, is scheduled to occur April 11.

When it announced the offering in March, Qatar Investment Authority said it then held about 5.5% of Santander Brasil's shares, noting that the sale is "part of the routine portfolio management activities undertaken by QIA from time to time."

Qatar Investment Authority and the offering's underwriters had originally proposed a price of 27 reais per unit, but investors were unwilling to accept that level and called for a lower price, "three people with direct knowledge of the deal" told Reuters.

Bank of America Merrill Lynch Banco Múltiplo SA and Banco de Investimentos Credit Suisse (Brasil) SA served as underwriters on the Brazilian offering, while Santander Investment Securities Inc., Merrill Lynch Pierce Fenner & Smith Inc. and Credit Suisse Securities (USA) LLC served as underwriters for the international offering.

As of April 5, US$1 was equivalent to 3.09 Brazilian reais.