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November 6, 2008 5:26 PM

Cleary, Shearman Advising on Billion-Dollar Brazilian Banking Merger

Posted by Brian Baxter

Istock_000003814175xsmall_2 Legal news trickles in slowly from the Southern Hemisphere.

Earlier this week, Brazil's second- and third-largest banks--São Paulo-based Banco Itaú and Uniao de Bancos Brasileiros (Unibanco)--announced plans to merge. Banco Itaú will acquire Unibanco in an all-stock transaction. The combined entity, which would create Brazil's largest bank, will have more than $260 billion in assets.

The Am Law Daily has learned that two New York firms known for their prowess in Latin American markets--Cleary Gottlieb Steen & Hamilton and Shearman & Sterling--have been retained as outside counsel on the deal.

New York-based capital markets and cross-border M&A partners Jorge Juantorena and Neil Whoriskey are advising Unibanco along with associate Amy Shapiro. In-house counsel at Unibanco include Claudia Politansky and Leila de Melo.

São Paulo-based Shearman capital markets and M&A partner Andrew Jánszky advised Banco Itaú along with Rome-based capital markets partner Robert Ellison and New York-based bank regulatory partner Bradley Sabel. The firm says that Ellison will soon be based out of São Paulo, Brazil's financial center (pictured above).

In-house counsel at Banco Itaú include managing director José Eduardo Lima de Paula Araújo, Álvaro Rizzi, Andre Sotnik, and Aline Ferreira.

This isn't the first time Cleary and Shearman have closed a big Brazilian banking deal. In May 2006, Cleary advised Bank of America on the sale of the Brazilian operations of its BankBoston subsidiary to Banco Itaú for $2.2 billion. Shearman advised Banco Itaú on the transaction.

Bloomberg reports that the proposed merger between Banco Itaú and Unibanco could be a byproduct of the global banking crisis. Both banks have been hurt by the credit crunch and the Brazilian government has injected nearly $50 billion into the country's banking system since late September.

The Central Bank of Brazil and other Brazilian regulatory authorities will have final approval on any merger. The final merged entity will be called Itaú Unibanco Holding, which would surpass São Paulo-based Banco Bradesco as Brazil's largest non-government owned bank.


Photo: Joseph Luoman/iStock

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