Travelex, the world’s leading foreign exchange specialist, Friday announced its entry into the Brazilian market through the acquisition of Grupo Confidence (Confidence), Brazil’s largest independent foreign exchange business. The transaction is consistent with Travelex’s growth strategy, which is focused on expanding in fast growing regions and emerging markets.
 
Under the terms of the agreement, Travelex will acquire an initial 49% shareholding in Confidence following Brazilian Central Bank and Presidential approval, with the remaining 51% to be acquired by no later than 2014. Travelex will finance the acquisition from internal resources.  

Peter Jackson, Chief Executive of Travelex, said the deal represents a unique opportunity for both Travelex and Confidence. Combining the company’s internationally recognized brand with the established local track record of Confidence will enable Travelex to accelerate its ambitious growth plans, said Jackson.

Founded in 1997, Confidence has grown to become Brazil’s largest independent foreign exchange business, operating a network of around 115 stores across Brazil and employing more than 700 people.

Currently, the company has 101 stores in shopping malls located across Brazil’s major cities and 14 airport stores covering all major airports including Guarulhos, Sao Paulo’s international airport. It is expected that these stores will be rebranded as Travelex over time.

In addition, Confidence has also recently established a foreign exchange bank operation following receipt of a banking license in May 2010, the first such Brazilian foreign exchange business to be granted such a license.

Under the leadership of Marcus Schalldach, Founder and Chief Executive, Confidence has grown strongly, doubling the number of stores over the past two years. In 2010, the company reported revenues of £36.4 million and profit before tax of £6.3 million.

Marcus will continue in his role as Chief Executive of Confidence, providing continuity of management and working in partnership with Travelex to continue the expansion of the business in Brazil.  

Brazil is a fast growing BRIC nation, with the economy growing at approximately 7.5% in 2010 and forecast to continue growing at a rate of more than 4% per annum until 2016. The Brazilian retail foreign exchange market is currently worth approximately $17 billion and is expected to continue growing.

Its growth will be supported by Brazil’s strong economic growth and rising passenger numbers. Events such as the 2014 World Cup and the 2016 Olympic Games are also likely to provide a boost to the inbound passenger foreign exchange market.  Confidence is ideally positioned to benefit from this growth.

30th May 2011