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Citigroup plans to start auctioning off its Japanese brokerage unit as early as this month, and the country's top three banks are expected to place bids in a deal likely worth up to $3.4 billion, sources with the knowledge of the matter said on Tuesday.
The sources, who spoke on condition of anonymity because the information is not yet public, said Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group are expected to place bids.
Nikko Cordial's sale price is seen ranging from 100 billion yen to 300 billion yen, the sources said.
Citigroup could also sell its Japanese asset management unit, Nikko Asset Management, they said.
Yoshito Shimoyama, a Tokyo-based spokesman for Citigroup, declined to comment.
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The three banks already have brokerage units, and purchasing Nikko Cordial would allow them to close the gap with Nomura Holdings, Japan's biggest brokerage.
Last month, Citigroup said it was committed to its Japanese brokerage and asset management units, rejecting media reports that it wanted to shed a big part of its Japanese business.
Citigroup had been on an aggressive push to expand in recent years, buying up Nikko Cordial, Japan's third-largest brokerage, and setting its sights on millions of affluent Japanese.
That expansion was stalled by the global credit crisis, raising questions about the firm's ability to become a major player in Japanese financial services.
Citigroup [C
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] last month said it plans to split into two businesses and shed troubled assets, following $28.5 billion of net losses over 15 months.
It put Nikko Cordial and the investment firm Nikko Asset Management into a collection of businesses and assets known as Citi Holdings.
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