Major Chinese brokerage house CITIC Securities’ long-awaited acquisition of a minority stake in French investment bank Crédit Agricole Corporate & Investment Bank’s Asian brokerage CLSA will provide Chinese investors with access to the firm’s global offerings.
Crédit Agricole has completed the sale of a 19.9% interest in CLSA to CITIC for US$310.32 million, with Crédit Agricole remaining the controlling shareholder.
“CITIC clients would have access to CLSA’s institutional execution capabilities and other CLSA services across the globe, assuming that they have already deemed an offshore mandate from the mainland authorities to trade outside China,” said a spokesperson for CLSA who confirmed both business entities would continue to run independently and separately.
The purchase was initially revealed last June, when CITIC said it would obtain a 19.9% stake in each of CLSA and CA Cheuvreux’s broking units for a combined sum of US$374 million.
However, in a joint statement released in March it was disclosed Cheuvreux had been dropped from the deal due to “new developments in economic conditions” which led to “a consensus... to modify the transaction”.
“At this point of time, there is no decision as yet on how the two firms will formulise client referral programmes or other business cooperation plans,” the spokesperson said.
Under the agreement, CITIC retains an option to buy the remaining 80.1% interest for US$941.68 million.
The move by Crédit Agricole is the second divestment of the firm's agency brokerage subsidiaries in recent weeks. CA Cheuvreux, the group's pan-European brokerage, is currently in exclusive discussions with Kepler Capital Markets to create an equity broker focused on continental Europe with sector and country research covering 650 stocks.