HSBC is to pay €300m (£266m) to French authorities in order to settle a long-running investigation into tax evasion by French customers of the bank, according to BBC News.
The allegation from the French financial prosecutor was that HSBC’s Swiss private banking unit assisted clients who wished to evade tax. The bank has acknowledged to ‘control weaknesses’ and said it was taking steps to address them.
Payment of the fine will conclude action against HSBC but it is still possible that two former legal directors could face further legal claims.
The investigation started in 2014 following the leak of data by a former IT employee. The records detailed transactions involving thousands of French customers. The French prosecutor claimed that €1.6tn of assets were involved in tax evasion schemes.
The settlement is the first deal to be struck under French rules introduced in 2016 which allow banks to settle claims without any finding of guilt. HSBC said it was glad to resolve “this legacy investigation which relates to conduct that took place many years ago.”
The French government is likely to receive as much as EUR4.2bn (USD5.5bn) from selling portions of its stakes in utilities Electricite de France SA (EPA:EDF) and GDF Suez SA (EPA:GSZ), Reuters reported.
A senior government source told the news agency that France would use the proceeds from the sale for investments in new industries.
French industry minister Arnaud Montebourg earlier told France 5 television in an interview that the government was considering the possibility of reducing its stakes in partly state-owned companies in the energy and transport sectors.
He did not name any companies but gave an example, saying that nothing would change if the government cut its shareholding to 33% from 36.7% or to 75% from 84.4%.
At the end of last year, France held a 36.7% stake in French utility GDF Suez SA (EPA:GSZ) and an 84.4% stake in Electricite de France SA (EPA:EDF), Reuters said.
According to Reuters calculations, based on current prices, a 10% stake in EDF would cost some EUR3bn, whereas a 3% stake in GDF Suez would be worth some EUR1.2bn.
A source close to finance minister Pierre Moscovici said previously that only the finance ministry could take a decision on possible stake sales and that at present there was not such a plan.
French oil services group Technip SA (EPA:TEC) said today it had agreed to buy Norwegian offshore engineering and services contractor Ingenium AS, without specifying how much it had paid for it.
The target, which is based in Oslo, designs and develops mechanical and electro-hydraulic tools and equipment for the offshore oil and gas industry, as well as provides engineering services for marine operations. It employs 20 engineers in the subsea business.
Through the acquisition, the company adds complementary engineering capabilities and enhances its position in one of its key markets, Technip’s managing director Odd Stromsnes said. The buyer added that it had previously worked on different projects with the Norwegian firm.
France’s government could participate in a capital hike at PSA Peugeot Citroen SA (EPA:UG) if needed, in an effort to help the carmaker limit its increasing losses, daily Liberation cited on Friday an unnamed government source as saying.
A state move to take a stake in Peugeot would be made only as a last resort plan, in case Peugeot could find no other way of dealing with the losses, the source told the paper, without giving any details.
The carmaker on Thursday cut the book value of its plants and other assets by 28%, adding EUR4.13bn (USD5.5bn) to its net loss for 2012.
The government said in October 2012 it was willing to provide state loan guarantees in the amount of EUR7bn to Peugeot’s financial unit Banque PSA Finance.
Peugeot did not wish to comment when contacted by Reuters.
The French government wants to buy into the submarine cable business of loss-making telecommunications equipment specialist Alcatel-Lucent SA (EPA:ALU), which could sell for between EUR600m (USD783m) and EUR700m, according to French business paper Agefi.
Agefi reported today, without naming its sources, that the French sovereign wealth fund FSI was among the several parties potentially interested in Alcatel-Lucent’s unit.
As the French company agreed in December to use assets as collateral for a loan from Credit Suisse Group AG (NYSE:CS) and Goldman Sachs Group Inc (NYSE:GS) to help meet maturing debt and finance restructuring, the government is worried that intellectual property could end up in the hands of foreign banks.
In December, French paper Les Echos reported that the government was contemplating a transaction that would see France Telecom SA (EPA:FTE) buy part of Alcatel-Lucent’s submarine cable unit.
FSI and Alcatel-Lucent did not wish to comment to Reuters.
French banking group Credit Agricole SA (EPA:ACA) views the stake it owns in Spanish peer Bankinter SA (MCE:BKT) as non-strategic and it is still considering all options regarding a further sale of Bankinter shares, CEO Jean-Paul Chifflet told a news conference on Tuesday.
According to Chifflet, Credit Agricole has recently cut its stake in the Spanish bank below the 20% threshold, but has made no decision as to the rest of the Bankinter holding.
However, Chifflet added that the Bankinter stake is among several non-strategic foreign investments that his bank plans to lower.
In an interview published by French newspaper Les Echos in December 2011, Credit Agricole’s chief executive said his company remained open to all options regarding its Bankinter interest. The stake the French bank holds in Portuguese lender Banco Espirito Santo SA (ELI:BES) was also mentioned by Chifflet as a potential target for sale.
Bankinter is the parent of domestic financial group Grupo Bankinter, which also includes financial firms Bankinter Gestion de Activos SGIIC, Bankinter Seguros Generales SA de Seguros y Reaseguros, Hispamarket SA, Intermobiliaria SA, Bankinter Consumer Finance EFC SA, Bankinter Capital Riesgo SGECR SA, Bankinter Sociedad de Financiacion SA and Relanza Gestion SA.
As of 31 December 2011, the bank’s main shareholder was Madrid-based Cartival SA with a stake of 23.91%.
French retailer Casino Guichard-Perrachon SA (EPA:CO) said today it had sealed a deal to buy Groupe Galeries Lafayette’s 50% stake in hypermarket chain venture Monoprix for EUR1.175bn (USD1.444bn).
The transaction, which is subject to regulatory approval, follows the signing of a letter of intent (LoI) on 28 June that ended a several months’ dispute between the joint venture partners over the price of Monoprix.
As part of the agreement, Galeries Lafayette has to sell its stake by 30 October 2013 and the two sides are to abandon the pending legal proceedings. Casino said last month that it had already agreed to the terms of a settlement agreement, which would allow Monoprix to grow under optimal conditions as part of the group.
Groupe Galeries Lafayette initially valued its stake at EUR1.95bn and later offered to sell it for EUR1.35bn or buy Casino’s holding for the same price. However, Casino rejected the offer as the bank that was advising it evaluated the stake at EUR700m.
When signing the LoI, the two sides said they would appoint Casino’s CEO Jean-Charles Naouri as board member of Monoprix and re-elect Philippe Houze as CEO of Monoprix. Upon completion of the deal, Casino will name a new chairman and CEO of Monoprix.
French communications major Publicis Groupe (EPA:PUB) said on Monday it had agreed to take over Israeli creative agencies network BBR Group for an undisclosed sum.
The buyer added that it has already collaborated with BBR and that it has a solid presence in Israel through its agencies Publicis Geller Nessis, Leo Burnett, Edologic and Superpush. Thanks to the latest deal, Publicis would be able to form an Israel-based communication agency with a staff of more than 400 across 23 offices.
Publicis Groupe chief operating officer and Publicis Worldwide executive chairman Jean-Yves Naouri said that the transaction expands the company’s services offering and that BBR will also benefit from Publicis’ scale and resources.
The target, focused on providing advertising and communications services with a headcount of 220, is a parent of a number of other agency brands, including Regev Kavitzky and Expert, TV content agency C, and media agency Smart Media, as well as key teams focusing on digital and design.
All of the firm’s agencies will remain autonomous and independently operated. BBR’s founder and chairman, Yoram Baumann, will become country chairman for Publicis Groupe in Israel.
BBR’s clients include DeLek Motors, cable TV Hot; Isracard, Procter & Gamble, Strauss and Super Pharm.
French building materials and glass producer Compagnie de Saint-Gobain SA (EPA:SGO) announced on Friday it had agreed to purchase UK insulating foam producer Celotex Group Ltd, to enhance its presence in the particular market in Britain.
The transaction, the value of which was not given, is awaiting clearance by the Office of Fair Trading (OFT). Through it, Saint-Gobain will improve its insulation offerings for new segments like flat roofs and floors, it said. Furthermore, the move bolsters its positions in the insulation for the new construction and renovation markets.
Celotex specialises in providing solutions that boost energy efficiency in buildings. The firm. with a staff of 170, has two production lines in Hadleigh near Ipswich, the UK. In addition, it had recently increased its capacity by setting up a GBP3m (USD4.6m/EUR3.7m) distribution and innovation centre. The company’s turnover for the fiscal year to August 2011 amounted to GBP69.7m.
Following the takeover, Celotex will continue to operate under its current brand name and will retain its existing management team.
Saint-Gobain produces and distributes building materials with operations in 64 countries and a headcount of almost 195,000. The French company generates annual sales of EUR42.1bn (USD52.5bn). It already operates in the British and Irish insulation markets via its Isover brand.
French electrical supplies distributor Rexel SA (EPA:RXL) on Wednesday said it had agreed to take over US sector player Platt Electric Supply Inc for an enterprise value of some EUR300m (USD382m), in line with strategy to boost market share in its key markets.
The deal will enhance Rexel presence in the US and increase to over 10% its share of the key market in western US which is expected to register a faster growth that the overall US sector, the buyer said.
The addition is expected to contribute to the buyer’s earnings by the end of next year.
Rexel’s chairman and CEO Rudy PROVOOS sees Platt Electric Supply as a strong strategic and geographic fit for the group’s US operations, he said, adding that the combination would generate substantial value for Rexel and its shareholders.
Platt Electric Supply’s president Jeff Baker will also assume the position of CEO for the company as well as that of vice president of Rexel Inc, a local unit of Rexel SA.
Completion is expected in early July, subject to customary conditions.
Oregon-based Platt Electric Supply operates 111 branches in seven US states and two logistics centres. It had sales of around EUR310m last year when it employed about 1,000. It supplies electrical contractors, industrial facilities and commercial businesses with electrical and energy efficiency products and services.
Rexel has US units Rexel Inc and Gexpro combining nearly 300 branches across the country. The US operations generated more than EUR2.5bn in sales last year.