Societe Generale to divest equipment finance arm to Groupe BPCE for €1.1bn
Societe Generale has reached a significant agreement to sell the bulk of its Societe Generale Equipment Finance (SGEF) activities to Groupe BPCE, marking a pivotal development in the European financial services industry. The Memorandum of Understanding, signed under the chairmanship of Lorenzo Bini Smaghi, involves a transaction valued at €1.1 billion, which is poised to enhance Groupe BPCE’s position as a leader in the capital goods leasing market across Europe.
The deal encompasses SGEF’s operations which specialize in providing customized financing and leasing solutions across diverse sectors including transport, industrial equipment, technology, medical, and renewable energy. This divestiture is in line with Societe Generale’s strategic roadmap launched in September 2023, aimed at streamlining operations and enhancing synergy within its business model. The transaction, expected to close in the first quarter of 2025, will also positively impact Societe Generale’s capital structure, boosting its CET1 ratio by approximately 25 basis points.
Slawomir Krupa, CEO of Societe Generale Group, articulated the strategic vision behind the divestment, “During the presentation of the Group’s strategy in September 2023, we affirmed Societe Generale’s ambition to be a rock-solid and sustainable top-tier European bank. The signing of the Memorandum of Understanding with Groupe BPCE for the sale of SGEF’s activities illustrates the strategic roadmap’s execution that creates value for all our stakeholders.”
For Groupe BPCE, the acquisition is a strategic move to solidify its footprint in the specialized financing business, particularly in equipment leasing across Europe. This acquisition aligns with its ongoing efforts to diversify its business and enhance revenue streams. Nicolas Namias, Chairman of the Management Board of BPCE, emphasized the strategic fit, noting, “The choice to invest in this growing profession, serving the financing of the real economy, the strengthening of the group’s offers in the energy transition and the usage economy is in line with our cooperative nature.”
The acquisition not only positions Groupe BPCE as a leader in the European leasing market but also enhances its capacity for serving a broader range of industries with innovative financial solutions. With this acquisition, BPCE intends to leverage the strong sectoral expertise of SGEF to benefit its vast network of clients, particularly through the powerful platforms of Banque Populaire and Caisse d’Epargne.
The completion of this transaction is subject to customary social and labor procedures, regulatory approvals, and meeting predefined conditions. Both parties are committed to a smooth transition, ensuring continuity and growth in services for all stakeholders involved.