Speculation of a British bid for Societe Generale, in the face of French opposition to a foreign takeover, pushed shares in SocGen up sharply today - nearly two weeks after it was plunged into a rogue trading scandal.
Shares in France's second-biggest listed bank jumped as much as 7.8% after a US investment bank published a note saying British bank HSBC had enough cash to launch a bid, prising SocGen away from potential domestic predators.
HSBC declined to comment on the report which adds to a list of takeover scenarios that have been swarming around the French bank since it announced €4.9 bilion of trading losses from unauthorised positions, which it blames on a single trader.
SocGen is racing to put the finishing touches to a €5.5 billion capital increase to shore up its capital. It says it can, and wants to, stay independent but is seen as especially vulnerable before the capital-raising deal goes through.
HSBC has emerged already as one of several potential European suitors if foreign bids are welcome, but analysts and banking sources said it was far from the most obvious contender.
France last week warned off foreign predators, sparking a clash with European Union officials over the bloc's fair competition rules and leaving French banks BNP Paribas and Credit Agricole as the front-runners.
Historic rival BNP Paribas, France's largest listed bank ahead of SocGen, has said it is looking at SocGen. Credit Agricole is also interested and could team up with BNP Paribas to try to break up SocGen, analysts say.
