((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto)) by Mathieu Rosemain
Societe Generale SOGN.PA is struggling to find a deal for its securities services unit, with potential bidders balking at the French bank’s asking price for the business, according to people familiar with the matter.
France’s third-largest listed bank has been trying to shed Société Générale Securities Services (SGSS) since last year, the sources said, as part of broader efforts by Chief Executive Slawomir Krupa to divest assets and rationalize the bank.
The bank is seeking more than 1 billion euros ($1.1 billion) for the unit, according to media reports.
U.S. bank State Street STT.N , one of the world’s largest custodians of assets after market leader BNY Mellon, has been in talks to buy SGSS, but discussions have stalled, according to a source.
Both SocGen and State Street declined to comment.
Although SocGen remains open to a sale at the right price, the bank decided that the sale of SGSS was no longer a priority given that the unit provides a steady flow of cash that other parts of the business have needed, two of the sources said.
The sources declined to be named due to the sensitivity of the matter.
Other potential buyers include CACEIS, the asset management business that France’s Crédit Agricole jointly owns with Spain’s Santander SAN.MC. CACEIS recently acquired the European activities of RBC Investor Services.
SSGS provides asset managers and pension funds with services such as asset custody.
The business saw its revenue fall by 17.5% in 2023, SocGen said in its annual report. The unit generated 849 million euros in revenue in 2022.
SGSS held €4.9 trillion in assets under custody at the end of December, making it the second largest asset custodian in France after BNP Paribas.
In April, SocGen agreed to sell its professional equipment financing business to French rival BPCE for 1.1 billion euros. The bank also agreed to the sale of its Moroccan units in April, and in December SocGen announced an agreement to sell two African subsidiaries in Burkina Faso and Mozambique.
As the market opened on Monday, SocGen shares had risen almost 12% since the poorly received strategic plan presented by Mr. Krupa last September. For comparison, the STOXX Europe 600 banks index .SX7E increased by almost 34% over the period.
SocGen shares fell about 7.5% on Monday after French President Emmanuel Macron called early legislative elections, spooking markets.
($1 = 0.9234 euros)