logo
Share SHARE
FONT-SIZE Plus   Neg

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

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.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

More Breaking News

Editors Pick
A California man has filed a lawsuit against McDonald's alleging that the fast food giant is defrauding customers by cramming its mozzarella sticks with filler instead of real cheese. Chris Howe is seeking at least $5 million in damages on behalf of consumers in 42 states and the District of Columbia. The... Jeep, the 4x4 vehicles, which has developed a strong bond with its masters, is aggressively on an expansion mode in its 75th anniversary year. Its fans have always been in love with the famous tag "Go Anywhere, Do Anything." Meat products maker Tyson Foods Inc. (TSN) reported a profit for the first-quarter that increased 49% from last year. It raised its profit outlook for fiscal year 2016 ,but it cut its annual sales guidance.
comments powered by Disqus
RELATED NEWS
Trade ACA now with 
Follow RTT