And The Final Bidders For World's Oldest Gold Trading Unit Are ...
(Kitco News) - The list of potential bidders for ScotiaMocatta, the world’s oldest gold trader owned by Canadian Bank of Nova Scotia (TSX: BNS.TO), has dwindled down to just two candidates, according to reports.
Goldman Sachs and Citi are the two final players left in the game, Financial Post cited three banking and industry sources as saying this week.
Both are currently in the middle of their “due diligence checks,” according to the report.
Other interested parties, including Japanese trading house Sumitomo and Australian bank ANZ decided not to pursue the venture after expressing interest.
There were no official comments issued by either Scotiabank, Goldman or Citi.
The sale is reportedly being conducted by JPMorgan and the goal is to have everything locked in by March 2018.
Scotiabank was hoping to get $1 billion for ScotiaMocatta, but that is not looking very probable, said one source.
“I think the process will see the great majority of the business move to a new owner, but would definitely expect there to be subsequent trimming, either by sale or closure,” the source said.
The two final bidders are interesting choices for ScotiaMocatta.
If Citi makes the purchase, it gets a much bigger stake in the precious metals trading.
And for Goldman it could mean a big turnaround for the firm’s struggling commodities-trading team, which surprised the markets with the worst annual performance in the company’s history in 2017, down 75% in net revenue.
Goldman’s commodities trading revenues dropped from $1.1 billion in 2016 to below $300 million last year, Bloomberg reported, quoting people familiar with the matter.
Scotiabank Looking To Sell World's Oldest Gold Trading Unit https://t.co/1rqvoFdf0l pic.twitter.com/veNErg3X01
— Kitco NEWS (@KitcoNewsNOW) October 18, 2017Scotiabank’s intention to sell ScotiaMocatta first came to light in October, with media reports citing a scandal involving smuggled gold from South America and a number of lawsuits that alleged manipulation of gold and silver price benchmarks.
ScotiaMocatta’s history goes all the way back to 1676 when Moses Mocatta partnered with the East India Co. to ship gold to India. The operations were set up in London. In 1997, Scotiabank acquired the bullion brokerage by purchasing it from Standard Chartered.
By Anna GolubovaFor Kitco News
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agolubova@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.