Societe Generale’s (SocGen) car rental division ALD has agreed to buy rival LeasePlan for â¬ 4.9 billion ($ 5.5 billion, Â£ 4.1 billion), the company said on Thursday. French bank.
The new deal will give SocGen more scale as the rental market shifts to electric vehicles.
In a statement, the bank said it would create a new company with a combined fleet of around 3.5 million vehicles, in which it would own 53% of the capital, and increase its own net profit per share by more than 5 million. % from 2024..
The deal comes four and a half years after SocGen launched a stake in ALD – and after the bank raised funds by selling assets such as asset management arm Lyxor.
ALD shares were up 7% early in the session while SocGen shares were 0.8% higher following the update.
FrÃ©dÃ©ric OudÃ©a, CEO of SociÃ©tÃ© GÃ©nÃ©rale, declared: âThis transaction project is a major step for ALD and for the SociÃ©tÃ© GÃ©nÃ©rale group.
âOver the past 10 years, through a long-term vision and rigorous execution, we have positioned ALD to take advantage of the tremendous growth potential of the sustainable mobility market.
“To actively support the economies as well as our customers in their energy transition, the combined entity will aim to become, in the medium term, a third pillar alongside, on the one hand, retail banking and insurance. , and on the other hand, companies and investment banking activities, strengthening the balance of the group’s economic model, âhe added.
OudÃ©a also underlined that the acquisition project is fully in line with the group’s strategy of generating profitable and sustainable growth and strong value creation for its shareholders.
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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade a CFD.
You can still benefit if the market moves in your favor, or suffer a loss if it moves against you. However, with traditional trading, you enter into a contract to exchange legal ownership of individual stocks or commodities for cash, and you own it until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the total value of the CFD trade to open a position. But with traditional trading, you buy the assets for the full amount. In the UK there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs come with overnight costs to hold trades (unless you’re using 1 to 1 leverage), making them more suitable for short-term trading opportunities. Stocks and commodities are more normally bought and held longer. You could also pay a commission or brokerage fees when buying and selling assets directly and you would need a place to store them safely.
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