Breaking News
FONT-SIZE Plus   Neg
Share SHARE

Credit Agricole, China's Citic In New Talks For Sale Of Hong-Kong Based CLSA

RELATED NEWS
Trade ACA now with 

French lender Credit Agricole SA's (CRARF.PK) Corporate & Investment Bank unit is entering into new negotiations with China's Citic Securities for the sale of its Hong-Kong based brokerage and investment business CLSA, the two companies said Thursday.

Citics in July had agreed to buy two stakes of 19.9 percent each in CLSA and Credit Agricole's broking businesses Cheuvreux for $374 million. But, it was never completed due to lack of regulatory approval.

The companies now reached a consensus following the recent talks amid the new developments in economic conditions to modify the earlier transaction and consider an alternative deal structure.

Under the changes, the companies will enter into additional exclusive negotiations allowing Corporate & Investment Bank to sell the remaining 80.1 percent of CLSA along with the upcoming acquisition of the 19.9 percent stake in CLSA by CITICS. The terms are to be negotiated and agreed upon between the parties within a short timeframe, the companies said.

Following the deal, CLSA will retain its independent management structure. Credit Agricole Corporate & Investment Bank unit will maintain its financial, business and operational support to CLSA during the transition phase and will maintain close relationships and cooperation with CLSA.

Meanwhile, Cheuvreux is no longer within the perimeter of the transaction and its new strategic orientations, currently under review will be announced at a later stage.

Once completed, the sale of CLSA is expected to help the troubled Credit Agricole move forward with its restructuring plans aiming to meet the tough new financial regulations in Europe, which is also marred by the ongoing euro-zone debt crisis.

Following credit rating downgrades last year, the lender had announced plans to reduce risk-weighted assets aiming to boost capital.

The company in last December had said that it would cut 2,350 jobs and also plans to scale back activity in the corporate and investment banking unit, which would include exiting from 21 of the 53 countries where the services are offered.

Credit Agricole shares closed Thursday's trading at 4.618 euros, down 0.132 euros or 2.78 percent in Paris.

Register
To receive FREE breaking news email alerts for Credit Agricole SA and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
After moving modestly higher in morning trading, stocks showed a substantial move to the downside over the course of the trading day on Wednesday. The major averages pulled back well off their highs for the session, sliding firmly into negative territory. Ebola "czar" Ron Kain is scheduled to meet with President Barack Obama on Wednesday as he begins his efforts to coordinate the government's response to the deadly disease. Klain, who previously served as chief of staff to Vice President Joe Biden and then-Vice President Al Gore, was named as Ebola Response Coordinator last Friday. Potentially complicating the outlook for control of the Senate, the results of a SurveyUSA poll conducted for WXIA-TV in Atlanta suggest that the Georgia Senate race between Republican David Perdue and Democrat Michelle Nunn could be headed for a runoff.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.