State Street is considering the acquisition of Societe Generale Securities Services (SGSS), reports Bloomberg (paywalled), based on anonymous sources. Societe Generale is purportedly seeking a valuation of more than one billion euros for its custody business.
Despite discussions regarding the terms of a potential purchase of SGSS, there is no certainty that State Street will finalise a deal, caution the sources. Both Societe Generale and State Street declined to comment.
State Street is not the only party expressing interest in SGSS. PostTrade360° reported in August that the Paris-based bank is said to be “exploring strategic options” for SGSS with Citigroup.
Terminated acquisition
In 2021, Boston-based financial services firm State Street planned to take over the Investor Services segment from Brown Brothers Harriman (BBH) for 3.5 billion USD. This acquisition was terminated in 2022 due to the complex regulatory environment for mergers and acquisitions that involve G-SIBs, the 30 global systemically important banks identified by the Financial Stability Board (FSB). State Street is one of them.
Restructuring
The potential acquisition of SGSS by State Street underscores the ongoing restructuring efforts within Societe Generale. Its CEO, Slawomir Krupa, has been actively divesting less profitable units within the bank as part of efforts to fortify its capital reserves.
In recent developments, Societe Generale agreed to sell its equipment finance unit to Banque Populaire and Caisse d’Epargne (BPCE SA) for 1.1 billion euros. Additionally, the bank announced plans to divest the majority of its Moroccan business to Saham Group in a deal valued at 745 million euros. Societe Generale has also been exploring potential disposals of its German consumer business, Hanseatic Bank; its UK private banking arm, Kleinwort Hambros; and Swiss private banking assets, reports Bloomberg.