BNP Takes Control of Paribas, Halting Tripartite Merger

Strategic Insights -

Michel Pebereau's takeover of Paribas, France's second-largest listed bank, has been formalized, marking a pivotal moment in the creation of the country's largest bank. The acquisition resulted from a hostile bid that received 65% approval from Paribas's shareholders. However, the plans for a three-way merger with Societe Generale, which would have created one of the world's largest banks, remain in limbo due to regulatory postponement. Paribas's outgoing chairman, Andre Levy-Lang, stepped down after a nine-year tenure, during which he transformed the bank into a technology-based institution.

Key Takeaways:

  • The hostile bid by Banque Nationale de Paris (BNP) for Paribas was successful, with 65% of shareholders approving the takeover.
  • The plans for a three-way merger with Societe Generale (SG) are on hold due to regulatory postponement.
  • Paribas's outgoing chairman, Andre Levy-Lang, announced his intention to leave last week and officially stepped down after a nine-year tenure.
  • Levy-Lang resigned despite reportedly being disappointed with BNP's takeover and urged them to keep the Paribas brand alive, citing its global recognition and technological strategy.
  • Daniel Bouton, the chairman of Societe Generale, and Ernest-Antoine Seilliere, the head of the Medef (employers' federation), resigned from Paribas's board, having consistently opposed BNP's bid.
  • Paribas sold its branch network to Societe Generale last year, shifting its focus towards future growth in retail banking through the internet and distribution through independent channels.
  • The merged BNP-Paribas will depend on the outcome of a regulator's decision regarding BNP's potential takeover of Societe Generale.

Statistics:

  • 65%: The percentage of Paribas's shareholders approving the hostile bid by Banque Nationale de Paris (BNP).
  • 9 years: The tenure of outgoing Paribas chairman, Andre Levy-Lang.
  • 1999: The year the hostile bid by BNP was successful, though the exact date is not specified.
  • 15: The page number where the editorial commentary about the takeover is located.

Sources:

  • [Financial Times, "Editorial Comment", Copyright 1999, Page 15.]
  • [Financial Times, "Bankwatch" section, date not specified]