Citic Securities Co, China's largest brokerage by market value, plans to acquire 19.9 percent of Credit Agricole SA (ACA)'s brokerage units, CLSA and Credit Agricole Cheuvreux, for $374 million, Bloomberg reported on Friday.
Citic and the investment-banking unit of Credit Agricole, France's third-largest lender by market value, plan to create a brokerage partnership and may seek to cooperate in other areas, the companies said in an e-mailed statement on Friday.
The accord with Beijing-based Citic, which is preparing for a $2.2 billion sale of shares in Hong Kong, stops short of their original plan to create an investment-banking joint venture in Asia. Credit Agricole, based in Paris, and Citic began talks in May 2010, and in December agreed to extend the talks by six months to June 30.
"It's a minimum agreement," said Pierre Flabbee, a Paris-based analyst at Kepler Capital Markets who has a "buy" rating on Credit Agricole's shares. "At least this is going to allow developing the businesses, but it isn't as ambitious as what was envisioned."
Citic shares rose 0.5 percent to 12.54 yuan ($1.93) at 10:28 am in Shanghai. They have declined 5.6 percent in the past year.
Credit Agricole and Citic had aimed to create "an equal partnership in global institutional brokerage, and Asia Pacific equity capital markets and investment banking," the French bank said in a Dec 20 statement. Credit Agricole had also planned that its corporate- and investment-banking activities would benefit globally from Citic's leadership in China, the statement said.
CA Cheuvreux, based in Paris, has a staff of 740 people at 15 offices from San Francisco to Tokyo, according to its website. CLSA, based in Hong Kong, was founded in 1986 and has more than 1,500 employees at 20 locations in 13 countries, according to information on its website.
Credit Agricole welcomes Citic "as an investor and partner of our project to create an integrated global equity brokerage platform spanning Europe, Asia and the US," Chief Executive Officer Jean-Paul Chifflet said in the statement.
