SocGen offers cut-price shares

Updated 12.26 Mon Feb 11 2008
Keywords: jerome kerviel, societe generale, money, business

Societe Generale, the French bank hit by a rogue trader scandal, is trying to raise money by selling shares at knock-down prices.

The bank has recorded losses of 4.9 billion euros (£3.7 billion) and trader Jerome Kerviel has been blamed for gambling on the share market.

In response, SocGen is hoping to raise 5.5 billion euros (£4.1 billion) by offering shares at 47.50 euros (£35.42) to existing shareholders at a ratio of one new share for every four held.

The move has been underwritten by US investment banks JP Morgan and Morgan Stanley and it represents a 39 per cent discount on the company's closing share price on Friday.

Societe Generale's internal controls have been criticised for failing to uncover Kerviel's trading behaviour sooner.

But the company is looking to the future and plans to expand overseas and planned a net income from its investment banking arm of 9 billion euros (£6.7 billion) by 2010.

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