AIB-OWNED BZ-WBK was said to be a likely target in spite of denials as Société Générale hit the acquisition trail yesterday with a €1.4 billion war chest after launching a €4.8 billion rights issue to repay state aid and to “seize potential external growth opportunities”.
In one of his first big strategic moves since becoming executive chairman in May, Frédéric Oudéa, executive chairman of France’s third-biggest bank, indicated he planned to tilt the group away from risky trading activities by making acquisitions in the safer realms of international retail and private banking.
It is the second cash call on shareholders – making a total of €10.3 billion – in less than two years.
SocGen’s move follows the decision last week by BNP Paribas, France’s biggest bank, to take advantage of buoyant stock markets by launching a €4.3 billion rights issue to repay state support. “The fact that a number of banks had announced their intention to reimburse the state led us to decide . . . we didn’t want to be the first, nor the last one to do this,” said Mr Oudéa.
SocGen intends to use the proceeds of the issue to repay the government’s €3.4 billion capital aid, of which half is in the form of preference shares and the rest a subordinated loan.
The remaining €1.4 billion will be used to improve the bank’s capital base and fund acquisitions. SocGen said it was in talks with Dexia, the Franco-Belgian bank, to buy the 20 per cent of Crédit Nord it did not own. The 20 per cent stake is valued at €500 million in Dexia’s accounts.
Top of the wish list is Poland, where SocGen is looking for a retail bank to complement its investment banking and consumer credit business.
The two-for-nine share issue is priced at €36 a share, a 26.9 per cent discount to the theoretical ex-rights price based on Monday’s closing price of €52.20. – (Copyright The Financial Times Limited 2009)
