Canadian billionaire David Thomson is backing a digital venture in South America’s second-largest economy.
Thomson will buy a 15% stake in Argentine digital bank Brubank, founded by former Citigroup Inc executive Juan Bruchou, according to a statement by the company. Brubank, a lender with no branches, has 40,000 customers after seven months in operation without advertising beyond word of mouth. The value of the deal was not disclosed, and is pending approval by Argentina’s central bank. The company looks to use the funds from the deal to grow in Argentina, and is analyzing expanding to Mexico, Colombia or Peru, Bruchou said.
The move comes amid double-digit inflation and a slow economic recovery from a recession after a currency crisis in 2018. Foreign direct investment has dropped amid investor jitters as the country heads into a presidential election in October. The payments sector is one of the few in Argentina that has seen deals this year, including a $750 million investmentby Advent International in the local operator of Visa Inc, and a stake purchase by China’s Tencent of payments app Uala.
Thomson, the third-generation scion of Canada’s richest family, is investing in digital banking in Latin America for the first time, Bruchou said. His family holding company controls Toronto-based Thomson Reuters Corp.
“He’s more than an investor to us, he’s a strategic partner,” chief executive officer Bruchou said by phone. “We share the same long-term vision of a bank that offers a better user experience and technology.”