*Daiwa, SMFG in talks to end investment banking JV-Nikkei
*Daiwa to spend 200 bln yen to buy SMFG's stake in JV
*Deal triggered by SMFG's purchase of Citi banking assets
(Adds Daiwa no comment, background, dateline)
TOKYO, Sept 4 Japan's Daiwa Securities Group
(8601.T) may spend about $2.2 billion to buy Sumitomo Mitsui
Financial Group's (8316.T) stake in their investment banking
joint venture, the Nikkei business daily reported on Friday.
Daiwa and Sumitomo Mitsui (SMFG) have an investment banking
venture called Daiwa Securities SMBC. Daiwa Securities, Japan's
No. 2 brokerage, owns 60 percent of the venture, while SMFG,
Japan's third-largest bank, owns the rest.
The fate of the venture has been in doubt after SMFG agreed
earlier this year to buy Citigroup's (C.N) brokerage and key
investment banking operations in Japan, including businesses
that overlap with Daiwa Securities SMBC. [ID:nBNG446757]
Daiwa and SMFG are in final talks to end the venture, the
Nikkei said. Daiwa will likely pay about 200 billion yen ($2.2
billion) for SMFG's stake, making it a wholly-owned subsidiary,
the newspaper said.
A spokesman for Daiwa declined to comment. No one at SMFG
was immediately available for comment.
However, even after the new deal, Sumitomo Mitsui will
continue to be Daiwa's main lender, and their loans and other
transactions will remain in place, the Nikkei said.
The companies are in talks to see if Sumitomo Mitsui could
lend about 100 billion yen to Daiwa to help it finance the
buyout, the paper said.
(Reporting by Anurag Kotoky in Bangalore and Nathan Layne in
Tokyo ; Editing by Maju Samuel, Leslie Gevirtz)