French banking group Societe Generale is considering a possible acquisition of larger rival BNP Paribas and has hired two U.S. banks to study potential deal scenarios, MarketWatch reports.
Such a deal is being championed by Daniel Boulton, SocGen’s chief executive, partly as a way of defending the bank against any potential bid from another European player, France’s Les Echos newspaper reported Friday.
But the idea doesn’t have unanimous support within the bank, as some SocGen executives would still prefer a deal with Italy’s UniCredit, the paper reported. Messages left with Societe Generale, France’s second-biggest bank, and BNP Paribas weren’t returned.
A deal between the two would create a European banking giant with a market capitalization of about 152 billion euros ($205 billion), putting it just behind HSBC Holdings.
Shares of Societe Generale added 1 percent in afternoon Paris trading, with BNP Paribas rising 2 percent in a slightly higher market.
SocGen has commissioned Morgan Stanley and another major U.S. house to study its options for a friendly or hostile bid, Les Echos reported.
Assessing the possibility of a SocGen-BNP Paribas deal, Les Echos noted that relations between the two management teams have been strained since a complex three-way takeover battle in 1999, which resulted in the merger of the previously separate BNP and Paribas banks.
UniCredit in May agreed to buy Italian rival Capitalia for some $29 billion, making an imminent deal with SocGen unlikely. But UniCredit hasn’t made any effort to hide its growth ambitions, saying more deals can be expected.