Citigroup Inc. announced Friday its public tender offer for scandal-tainted Nikko Cordial Corp. has succeeded, resulting in the biggest buyout — at 920 billion yen — of a Japanese firm by a foreign company.

The U.S. financial giant, which already had 4.9 percent of Nikko Cordial shares, will gain 61 percent of the brokerage’s outstanding shares.

The buyout will allow Citigroup to expand its base for corporate and retail businesses in Japan by using the network of Nikko Cordial, Japan’s third-biggest brokerage.

The tender offer expired Thursday, and the transaction will be settled in cash starting May 9, Citigroup said in a statement.

Citigroup is considering further increasing its stake to make the securities firm its 100 percent subsidiary, the statement said. If Citigroup’s stake tops 75 percent, Nikko Cordial will have to be delisted from the market.

“I’m excited,” said Douglas Peterson, chief executive officer of Citibank’s Japan unit, referring to the new business alliance with Nikko Cordial.

Asked why Citigroup is investing in the Japanese market when it is slashing 17,000 jobs, Peterson said the acquisition of Nikko Cordial shares is part of its effort to drum up business outside the U.S.

“We decided that Japan is a very important market for us and one of the priorities to put our capitals,” Peterson told a joint news conference with Nikko Cordial President and CEO Shoji Kuwashima.

Asked if he plans to cut Nikko Cordial’s workforce, Peterson did not deny the possibility but said Citigroup would be focusing on growth rather than restructuring.

“By fusing Nikko Cordial’s brand based on its domestic network and Citigroup’s global network, I think we can increase our presence as a comprehensive financial institution,” Kuwashima said.

Two-thirds of the shares would have given Citigroup the power to exercise authority over important moves such as mergers, but Kenji Mizutani, a professor of economics at Chukyo University in Tokyo, said Citigroup’s results still give it significant control of Nikko Cordial’s operations.

“The important thing is what Citigroup will do from here,” Mizutani said.

Mizutani said Citigroup may have a tough time blending American-style management, including performance-based salaries, with Nikko Cordial’s corporate culture.

If Nikko employees protest any changes to their working conditions, it may take time for there to be synergy between the two firms, he said.

There had been growing speculation that Citigroup might not be able to get a majority, as foreign investment funds had said the 1,700 yen offering price was too low.

On April 3, Bermuda-based Orbis Investment Management Ltd. said it had placed all of its 6.9 percent in Nikko Cordial shares on sell order for 1,900 yen. The move appears to have been a pressure tactic to get Citigroup to raise its price.

Harris Associates L.P. of the U.S. has also said it will not sell its 4.97 percent stake. Both investment funds were unable to be reached immediately.

As of the end of March, 65.2 percent of Nikko Cordial shares were owned by foreign investors, the firm said.

The public tender bid was successful because many domestic institutional investors, including Mizuho Corporate Bank, which has a 4.9 percent stake, and individual investors appear to have responded to the offer.

Nikko Cordial admitted in December that it had padded profits by manipulating transactions among affiliated companies. Since then, its business has been damaged and speculation grew that the Tokyo Stock Exchange would delist it.

Thinking a tieup with a big-name financial institution would help regain customer confidence, Nikko Cordial agreed to go under the umbrella of Citigroup, which was seeking a quick way to expand its business here.

In March, Citigroup announced it would launch a public tender offer for Nikko Cordial at 1,350 yen — a move Nikko Cordial’s board of directors approved.

However, six days later, the TSE surprised the market by announcing it would not delist the brokerage because it couldn’t confirm that it padded its financial reports in a systematic manner. The statement juiced up its share price immediately, forcing Citigroup to raise its offer to 1,700 yen the following day.

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