Grupo Mexico Submits New Binding Offer for Citi's Banamex, Reigniting Acquisition Battle

Grupo Mexico Renews Bid for Banamex

Mexican mining and transportation conglomerate Grupo Mexico has submitted a new binding offer to acquire Citi's retail banking unit, Banamex, in Mexico. The offer, made on Friday, October 3, 2025, marks a renewed effort by the company, controlled by billionaire German Larrea, to purchase the financial institution after previous negotiations fell through in 2023.

Grupo Mexico's proposal outlines the acquisition of 25% of Banamex at 0.85 times book value and the remaining 75% at 0.80 times book value. The company stated its 'unwavering confidence' in Mexico and expressed its intent to restore Banamex's competitive standing among its peers. A key priority for Grupo Mexico is also the safeguarding of Banamex's workforce.

Previous Negotiations and Recent Developments

The initial attempt by Grupo Mexico to acquire Banamex in 2023 was abandoned due to tensions with the administration of then-President Andres Manuel Lopez Obrador. Sources indicated that the government's demands, including requirements for the firm to remain in Mexican hands and prohibitions on layoffs, contributed to the deal's collapse.

The new offer from Grupo Mexico comes just a week after Citi announced it had agreed to sell a 25% stake in Banamex to Mexican billionaire Fernando Chico Pardo for approximately $2.3 billion. This transaction, valued at 0.80 times book value for the stake, is expected to finalize in the second half of 2026. Citi incurred a goodwill impairment charge of about $726 million from this deal. Citi had previously stated its preference for the deal with Chico Pardo and a subsequent initial public offering (IPO) for the remaining Banamex shares. Unlike the previous administration, current President Claudia Sheinbaum has not imposed similar conditions on the sale.

Banamex's Strategic Divestment by Citi

Citi acquired Banamex in 2001 for $12.5 billion. As part of its strategy to simplify operations and focus on its institutional business, Citi has been working to divest its retail unit in Mexico. In December 2024, Citi completed the separation of Banamex from its institutional banking operations in Mexico, preparing it for a potential public listing.

The planned IPO for Banamex, initially slated for 2025, has been postponed until 2026, citing market instability and the need for regulatory approvals. Banamex, which operates approximately 1,300 branches and over 9,100 ATMs, serves nearly 20 million clients across Mexico. In the first nine months of 2024, Banamex generated over $4.7 billion in revenue, contributing about 8% to Citi's total revenue.

Outlook for Banamex's Future

Grupo Mexico's renewed bid introduces a new dynamic to the future of Banamex, potentially challenging Citi's current strategy of a partial sale followed by an IPO. The conglomerate has indicated that if Fernando Chico Pardo wishes to retain his 25% stake, Grupo Mexico's offer would adjust to acquire the remaining 75% of the firm at 0.80 times book value. The coming weeks will likely determine the path forward for one of Mexico's largest banking institutions.