New deal reached on Fortis asset sale to BNP | business | Hindustan Times
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New deal reached on Fortis asset sale to BNP

Belgian officials, BNP Paribas and the Fortis holding company have reached an agreement on the sale of most of the group's Belgian assets to the French bank, the Belgian government announced on Friday.

business Updated: Jan 30, 2009 13:50 IST

Belgian officials, BNP Paribas and the Fortis holding company have reached an agreement on the sale of most of the group's Belgian assets to the French bank, the Belgian government announced on Friday.

"Fortis Holding and its shareholders now have a perspective and means united around a credible industrial project," a statement said, after a meeting of the government's inner cabinet early on Friday.

Under the deal, thrashed out through the night, the French group would give up plans to buy most of Fortis's insurance business.

BNP would take 10 per cent of the insurance operations for a sum of 550 million euros ($ 709 million), instead of 75 per cent of the Belgium insurance business as was planned in a previous agreement reached in October.

The statement said that the Fortis board had approved the plans on the condition that they be accepted by shareholders.

The government hopes minority shareholders will now back the sale of most of the group's Belgian assets to BNP after the initial deal was suspended by a Brussels court because they had not been consulted.

This led to the transaction being frozen.

As the global financial crisis undermined investor confidence, the Belgian-Dutch financial services group was broken up in October. The Dutch state took over its Dutch assets, and Belgium the Belgian banking assets.

The Belgian state then orchestrated the sale of Fortis's Belgian banking assets and 75 per cent of its Belgian insurance business, still owned by the holding company, to BNP Paribas.