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CORRECTED-UPDATE 1-Spain's Santander to buy 51 pct of El Corte Ingles finance arm -sources
October 7, 2013 / 3:07 PM / 4 years ago

CORRECTED-UPDATE 1-Spain's Santander to buy 51 pct of El Corte Ingles finance arm -sources

(Corrects figure in second para, 10.5 million not billion)

By Carlos Ruano and Sarah Morris

MADRID, Oct 7 (Reuters) - Spain’s largest bank, Santander , is finalising a deal to buy a controlling stake in the country’s largest consumer finance business from department store chain El Corte Ingles, sources said on Monday.

Santander would take 51 percent of one of the most lucrative assets of El Corte Ingles, two sources close to the deal said. The retailer has more than 10.5 million store card customers and its finance arm lent 6.6 billion euros ($8.97 billion) last year.

One of the sources said the deal could be announced as soon as Monday evening. The sources declined to say how much the deal could be worth.

The finance unit had revenue of 168.4 million euros in 2012.

The deal would allow Santander to access the privately owned firm’s huge database of customers to target them with products from its own consumer finance business.

El Corte Ingles, a household name in Spain, is under pressure from creditors to sell assets as it restructures 5 billion euros of debt.

Through its store card, it lends to shoppers to make purchases in its chain of more than 80 department stores, which sell everything from clothing and food to electronics, kitchens and holidays.

El Corte Ingles is struggling to remain competitive as Spanish consumers hunt for bargains in the country’s sharp downturn.

Retail sales in Spain have dropped for 38 consecutive months, and El Corte Ingles posted an 18 percent drop in net profit for 2012 to 171 million euros, year-on-year, and sales down 8 percent to 14.5 billion euros. ($1 = 0.7355 euros) (Reporting by Carlos Ruano; Writing by Sarah Morris; Editing by Fiona Ortiz and Pravin Char)

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