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Dexia eyes SocGen link
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September 20, 1999: 10:16 a.m. ET
French-Belgian bank group launches restructuring plan, seeks alliances
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LONDON (CNNfn) - Shares in Dexia France surged Monday, a day after the French bank announced a $6.06 billion planned merger with its Belgian sister company to form Europe's largest municipal lender.
The group, formed in 1996, also announced its intention to seek closer ties with France's Société Générale. Analysts said its complex current ownership structure precludes closer alliances and full mergers.
Dexia France shares surged last week on speculation of a tie with SocGen.
Dexia France (PDEX) stock surged another 5.2 percent to reach 140.5 euros Monday, though shares in Dexia Belgium slid 3.6 percent to trade at 141.50 euros.
The bank was formed in 1996 by the merger of France's Crédit Local de France (CLF) and Belgium's Credit Communal, cemented by a series of complex cross-shareholdings.
The French arm focuses on lending to the municipal sector and has expanded throughout Europe as the rise in public-private finance projects has boosted the demand for funding from city and state governments.
Dexia Belgium focuses on the Belgian retail market while a Luxembourg-based unit of the bank offers private banking services.
Dexia France said it is in talks with SocGen's Crédit du Nord unit, which retains a 20 percent stake in CLF, about cooperation to expand Dexia's limited retail activities in France.
Dexia's two principal units aim to complete their restructuring by November, with Dexia Belgium acquiring the French arm in a one-for-one share swap valued at 5.8 billion euros ($6.06 billion.
If the bid secures more than 90 percent acceptance, it will be sweetened to a 41-for-40 exchange, offering a 13 percent premium on the Sept. 16 closing price for Dexia France. 
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Dexia
Société Générale
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