Société Générale has concluded the acquisition of Crédit Agricole's 50% stake in the capital of Newedge, in a move that is giving the French bank 100% control of the derivatives brokerage subsidiary.
As part of the deal, Société Générale has also sold 5% of the capital of Amundi to Crédit Agricole, which brings the bank's stake in the company to 20%.
"The finalisation of the acquisition of Newedge is a significant strategic initiative which will allow us to position ourselves as key player in the rapidly growing sector of post trade services for investors," said Christophe Mianné, deputy head of Société Générale's global banking and investor solutions division.
The bank said that with the combination of Société Générale's activities and Newedge's execution and clearing services (both on listed and OTC products), clients will benefit from a fully integrated market activities offering, including cross asset research, tailor-made investment and hedging solutions, in addition to a leading prime brokerage offer, and direct execution across 85 markets worldwide.
"We will be able to offer our clients the best of both institutions: the financial guarantee and financing capacities of a leading bank, allied with Newedge's leading market positions, in particular in prime brokerage and clearing services," added Mianné. "We are thus strengthening our international presence, whilst positioning ourselves favorably in the new regulatory environment."
Société Générale said these transactions are expected to result in a moderate positive impact on the group's earnings and a negative impact of approximately 10 bps on the group's Basel 3 Core Tier One ratio in Q2 2014.
The completion of the project has been approved by the relevant regulatory authorities.
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