Billionaires Slim, Larrea Face Off For Citi's Mexico Business - Sources

Mexican corporate titans Carlos Slim and German Larrea are squaring off to acquire Citigroup Inc's local retail arm after the latest round of bidding left the duo as frontrunners, sources familiar with the matter said.

New proposals were submitted last week for Citibanamex, which is being offloaded by the U.S. bank as part of Chief Executive Officer Jane Fraser's efforts to sell some international operations and simplify the firm.

The bid amounts for the unit, known too as Banamex, were not disclosed by the sources. One noted that Citigroup was set to provide candidates with more in-depth information on the business in the coming days, meaning prospective prices could be revised.

Banca Mifel - run by Daniel Becker, who separately heads Mexico's banking association - also made an offer but it lacked the financial backing to compete with the proposals from Slim's Inbursa and Larrea's Grupo Mexico, one of the sources said.

The sources also cautioned that no deal was guaranteed with any party and Citigroup could ultimately decide to sell Banamex shares on the Mexican Stock Exchange instead. They spoke on condition of anonymity to discuss private information.

"In line with our process, we are in constant dialogue with a number of potential buyers and remain committed to pursuing any route that maximizes value for our shareholders," a Citigroup spokesperson said.

Inbursa and Grupo Mexico declined to comment. Banca Mifel did not immediately respond to a request for comment.

Backed by Slim, Mexico's richest person, Inbursa was flagged as a strong contender when Citigroup put Banamex up for sale in January. If it wins, Inbursa would become the country's second-largest lender after the local unit of Spain's BBVA.

However, mining tycoon Larrea has the firepower to compete as a candidate to buy Banamex, the sources said.

A prospective duel comes after other heavyweight names exited the process. Grupo Financiero Banorte said on Friday it had pulled out, without offering a reason for the decision, joining other withdrawals including retail and media tycoon Ricardo Salinas Pliego and Spanish bank Santander.

The Mexican authorities, including President Andres Manuel Lopez Obrador, have pushed for a domestic buyer, with analysts valuing Banamex from anywhere between $7 billion and $12 billion.