HSBC Holdings PLC said Friday it has received an offer of euro2.1 billion (US$3.2 billion) in cash for its French regional banking subsidiaries from Banque Federale des Banques Populaires.
HSBC has now entered into exclusive discussions with the bidder, which is the central body of Groupe Banque Populaire, a mutual banking group.
The regional banks included in the deal, which altogether have 400 branches, are Societe Marseillaise de Credit, Banque de Savoie, Banque Chaix, Banque Marze, Banque Dupuy de Parseval, Banque Pelletier, and Credit Commercial du Sud-Ouest.
They hold total assets of euro8.3 billion, and in 2007 generated net profit of euro100 million, or less than 20 percent of HSBC's pretax profit in France.
"This offer is an opportunity for HSBC to redeploy capital to other investments as we pursue our strategy and rebalance our activities towards emerging markets and faster growing business segments," Chairman Stephen Green said.
HSBC shares dipped 1.9 percent to 765.5 pence (US$15.18; euro10.03) on the London Stock Exchange.