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Itau Unibanco (ITUB) Inks Deal to Acquire Zup IT Servicos
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On Oct 31, Itau Unibanco Holding SA (ITUB - Free Report) announced that it has entered into an agreement to acquire Zup IT Servicosin a span of four years for about R$ 575 million. With this acquisition, Itau Unibanco seeks to accelerate development of digital transformation projects offer new functionalities and digital products to its customers.
Founded in 2011, Zup is a consultancy company offering technology solutions. With more than 900 employees, it has systems that facilitate the integration of new digital developments using legacy corporate systems.
Per the terms, the purchase of 100% capital stock of Zup will be done in three parts. In the first part, Itau Unibanco will acquire 51.0% of the total and voting capital of Zup for about R$ 293 million. In the second phase, Itau Unibanco will buy a further 19.6% equity interest and finally in the fourth year, it will acquire the remaining interest of shareholders.
Notably, Zup will continue to run its business in a separate and autonomous manner, thereby preserving its principles and values.
Itau Unibanco remains focused to undertaking inorganic growth strategies. In August 2018, it received consent from the Central Bank of Brazil to execute investment in XP Investimentos S.A. (XP Holding), which was announced in May 2017. With this acquisition, Itau Unibanco reiterated its commitment to the Brazilian market, and its aim to create long-term shareholder value.
Itau Unibanco seeks to build strategies and undergo digitization to expand operations in Brazil and abroad. However, regulatory headwinds in the domestic country and intense competition remain concerns.
Shares of Itau Unibanco have lost 1% year to date against 5.7% growth registered by the industry.
Bank of Montreal’s (BMO - Free Report) shares have rallied 14% year to date. Also, the company’s earnings estimates for the current year have been revised over the past 30 days. The stock carries a Zacks Rank of 2 (Buy), at present.
Royal Bank of Canada’s (RY - Free Report) share price has increased 18.4% so far this year. Further, the company’s earnings estimates for the ongoing year have moved upward in the past 30 days. The stock carries a Zacks Rank of 2, currently.
HDFC Bank Limited’s (HDB - Free Report) shares have gained 18.9% year to date. In addition, this Zacks Rank #2 company’s earnings estimates for 2019 have moved up 1% in 30 days’ time.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
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Itau Unibanco (ITUB) Inks Deal to Acquire Zup IT Servicos
On Oct 31, Itau Unibanco Holding SA (ITUB - Free Report) announced that it has entered into an agreement to acquire Zup IT Servicosin a span of four years for about R$ 575 million. With this acquisition, Itau Unibanco seeks to accelerate development of digital transformation projects offer new functionalities and digital products to its customers.
Founded in 2011, Zup is a consultancy company offering technology solutions. With more than 900 employees, it has systems that facilitate the integration of new digital developments using legacy corporate systems.
Per the terms, the purchase of 100% capital stock of Zup will be done in three parts. In the first part, Itau Unibanco will acquire 51.0% of the total and voting capital of Zup for about R$ 293 million. In the second phase, Itau Unibanco will buy a further 19.6% equity interest and finally in the fourth year, it will acquire the remaining interest of shareholders.
Notably, Zup will continue to run its business in a separate and autonomous manner, thereby preserving its principles and values.
Itau Unibanco remains focused to undertaking inorganic growth strategies. In August 2018, it received consent from the Central Bank of Brazil to execute investment in XP Investimentos S.A. (XP Holding), which was announced in May 2017. With this acquisition, Itau Unibanco reiterated its commitment to the Brazilian market, and its aim to create long-term shareholder value.
Itau Unibanco seeks to build strategies and undergo digitization to expand operations in Brazil and abroad. However, regulatory headwinds in the domestic country and intense competition remain concerns.
Shares of Itau Unibanco have lost 1% year to date against 5.7% growth registered by the industry.
Itau Unibanco currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Key Picks
Bank of Montreal’s (BMO - Free Report) shares have rallied 14% year to date. Also, the company’s earnings estimates for the current year have been revised over the past 30 days. The stock carries a Zacks Rank of 2 (Buy), at present.
Royal Bank of Canada’s (RY - Free Report) share price has increased 18.4% so far this year. Further, the company’s earnings estimates for the ongoing year have moved upward in the past 30 days. The stock carries a Zacks Rank of 2, currently.
HDFC Bank Limited’s (HDB - Free Report) shares have gained 18.9% year to date. In addition, this Zacks Rank #2 company’s earnings estimates for 2019 have moved up 1% in 30 days’ time.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>