Swiss Life backs takeover of French partner

The Swiss insurance company, Swiss Life, says it will support a takeover bid of the French bank, CCF, in which it is a major shareholder. The company made the announcement after the international banking group, HSBC, put in an offer to buy CCF.

The Swiss insurance company, Swiss Life, says it will support a takeover bid of the French bank, CCF, in which it is a major shareholder. The company made the announcement after the international banking group, HSBC, put in an offer to buy CCF.

Swiss Life and CCF’s other major shareholders unanimously backed HSBC’s surprise takeover bid, which valued CCF at 11.08 billion euros (SFr17.61 billion).

The Swiss insurer, which owns 14.5 per cent of CCF, agreed to support the bid in exchange for shares in HSBC. The bank is offering either 150 euros in cash (SFr238) per share, or 13 HSBC shares per CCF share.

CCF’s other main shareholder, the Dutch bank ING, said it would sell its 19 per cent holding for a pre-tax profit of about 900 million euros.

HSBC Group chairman, John Bond, said the acquisition would give the bank “a significant base for operation in the Euro-zone, where we have been under-represented”.

The bid is the latest in a succession of takeovers by HSBC, which last year purchased Republic New York Corp., parent of the Republic National Bank of New York, for nearly 10 billion dollars.

The acquisition of CCF has still to be approved by French banking regulators.

If it is successful, CCF will become the first major French retail bank to fall into foreign hands.

Analysts say it will probably lead to a small number of job losses, as well as expected cost savings of about 150 million euros (SFr238 million) by 2001.

swissinfo and agencies