Nikko Cordial Corp., a major Japanese brokerage firm and the holding company for Nikko Cordial Securities and other subsidiaries, announced on Wednesday that it has obtained shareholder approval to become a wholly owned subsidiary of Citigroup Inc., a major U.S. bank through an equity swap under a triangular merger.

Following the approval, about 30,000 Nikko Cordial's stocks will be swapped for Citigroup shares at the end of January. This triangular merger is the first case that has succeeded by foreign company's takeover since the ban on such transactions was lifted in May.

We aim to become a comprehensive financial services provider through the alliance with Citigroup, which comes at a time when customer needs come to be more diversified, Shoji Kuwashima, Nikko Cordial President, said in front of 163 investors in the morning meeting.

Douglas Peterson, chief executive officer of Citigroup Japan Holdings Ltd., demonstrated the importance of the tie-up by showing the role of Japanese market on Citigroup's global strategy, and also said the financial conglomerate will develop specific plans for the Japanese market as early as next year.

Nikko shareholders are also going to support a plan for the company to shift to a fiscal year ending in December while the brokerage currently plans to close its books in March.

It seems that Citigroup will boost its marketing activities in Japan through the strong emergence through the tie-up with Nikko Cordial while its U.S, market was hurt by heavy subprime-loan related losses.

Citigroup New york city