Santander Brasil Minorities Face a Share-Swap Buyout

Banco Santander wants to buy out the minority shareholders of its Brazilian unit through a share swap. The company says Santander Brasil will keep its B3 listing.

Banco Santander has launched a santander brasil buyout offer for the 10% of its Brazilian unit it does not own. The share swap will not remove Santander Brasil from the B3 exchange, the company says.

On 30 July 2026, Santander Brasil disclosed a material fact. Its controlling shareholder, Banco Santander, plans an exchange offer for about 10% of the bank’s capital held by minorities.

The Spanish parent bank wants to buy all outstanding shares, units, and American depositary shares (ADSs) of Santander Brasil. These represent up to 10% of the Brazilian bank’s share capital.

The deal is not a cash payment. Minority shareholders will exchange their Santander Brasil shares for Brazilian depositary receipts (BDRs) backed by Banco Santander shares.

The proposed exchange ratio is 0.2028 BDRs or ADSs of Banco Santander for each ordinary or preferred share of Santander Brasil. For each unit or ADS, the ratio is 0.4056 BDRs or ADSs.

The operation is estimated at about 1.9 billion euros (US$2.2 billion). That is roughly 11.2 billion reais (US$2.2 billion) at current exchange rates.

Banco Santander says the ratio represents a 15% premium. That is over the closing price of Santander Brasil securities on 30 July 2026, the last session before the announcement.

On 31 August 2026, Santander Brasil filed a communication reiterating that Banco Santander is preparing the required filings. The offers are expected to be concluded in the first half of 2027.

Completion depends on regulatory approvals and shareholder approval for a capital increase. The offers will be made in Brazil and the United States.

Santander Brasil says the offer does not aim to delist the company from B3, Brazil’s stock exchange. The bank will keep trading in Sao Paulo even after the offer closes.

The picture is different in the United States. Depending on uptake, Santander Brasil could delist its ADSs from the New York Stock Exchange and end its SEC registration.

Santander Brasil’s American depositary receipts jumped 9.3% in New York trading on 30 July 2026, the day of the announcement. That reflects the premium built into the offer.

Brazilian markets reacted too, though full B3 trading data was not detailed in the reports reviewed. Investors are waiting for more details on the exchange offers.

Santander Brasil is one of the largest banks in Brazil. It is a subsidiary of Banco Santander, which is based in Spain.

The Brazilian unit has been listed on B3 since 2009. The parent bank currently holds about 90% of the capital.

Minority shareholders should wait for the official exchange offer documents. These will detail the terms and conditions.

They can choose to accept the offer or keep their shares. Santander Brasil says the offer is voluntary, with no minimum acceptance level required.

The offers require approval from Brazilian regulators, including the securities commission CVM. They also need approval from the central bank.

In the United States, the offer must comply with securities laws. The process could face delays if regulators have concerns.

This buyout uses a share swap rather than a cash payment. That lets Banco Santander avoid a large upfront cash outlay while still boosting its stake in Santander Brasil.

Minority shareholders who accept end up as direct holders of Banco Santander stock, listed in Spain, instead of Santander Brasil stock.

Brazilian financial outlets have flagged the offer as a way for Banco Santander to simplify its structure. It would do so without shutting Santander Brasil out of B3.

Some investors may still prefer a cash offer. The share swap exposes them to the performance of Banco Santander’s stock instead.

Banco Santander will file the necessary documents with regulators. The exchange offers are expected to launch in the coming months.

Shareholders will receive a prospectus with full details. The offers are expected to close by the first half of 2027.

Banco Santander will launch two voluntary exchange offers at the same time. One targets Brazil, the other the United States.

In Brazil, Santander Brasil minority shareholders can swap shares for Banco Santander BDRs. In the US, ADS holders can swap for Banco Santander ADSs.

Each Santander Brasil ordinary or preferred share yields 0.2028 Banco Santander BDRs or ADSs. Each Unit or ADS, combining one ordinary and one preferred share, yields 0.4056 BDRs or ADSs.

The offers are voluntary, so shareholders can choose whether to take part. Together, the targeted shares, units, and ADSs represent up to 10% of Santander Brasil’s capital.

A BDR is a certificate traded on Brazil’s B3 exchange that stands for shares in a foreign company. An ADS is the same idea in the United States.

Here, holders would receive BDRs and American depositary shares of Banco Santander in exchange for their Santander Brasil shares.

For every 100 Santander Brasil shares, a holder gets about 20 Banco Santander BDRs. For every 100 units, that is about 41 BDRs, since each unit equals two shares.

The BDRs and ADSs would trade on B3 and the New York Stock Exchange, respectively. Banco Santander is registering as a foreign issuer in Brazil to make this possible.

The exchange ratio offers a 15% premium over Santander Brasil’s 30 July 2026 closing price, the last trading day before the announcement. This is meant to encourage minority shareholders to accept.

Take a hypothetical share that closed at R$10 (US$1.96) on 30 July. The certificates offered for it would be worth about R$11.50 (US$2.26) under that same rate.

That premium is fixed to the 30 July price, not the current price. If Santander Brasil’s share price has since risen, the real-world premium may now be smaller.

Banco Santander controls Santander Brasil and holds about 90% of its capital. The other 10% belongs to minority investors.

The controlling shareholder is based in Spain and is one of Europe’s largest banks. Its Brazilian arm trades on B3 as SANB11 units and has ADSs listed in the United States.

By buying out minorities, Banco Santander aims to simplify its corporate structure and raise its stake in its Brazilian operations.