Investment banks are jostling for position in the potential bidding war for Société Gé*érale, which became vulnerable to an approach after last week's rogue trading scandal.
At least three banks have won mandates to defend SocGen from a potential takeover bid. Sources close to the situation said yesterday that JP Morgan and Morgan Stanley, the US investment banks arranging SocGen's emergency rights issue, had had their mandate extended to include M&A advisory work.
Rothschild is also understood to be involved on the defence, although it has not yet been handed any formal role. All of the banks declined to comment.
BNP Paribas revealed on Thursday that it was considering the situation at SocGen. It has been widely backed as the favourite to launch a bid for its stricken arch-enemy.
Reports in France named two investment banks supposedly called in by BNPP to provide M&A advisory services yesterday. The French bank declined to comment, but is understood to have held preliminary discussions with several banks, including Lehman Brothers.
Another domestic rival, Credit Agricole, is also thought to be looking at SocGen. While no official mandates have been handed out, it is understood that the French bank has held talks with Lazard over a potential role as adviser. Both declined to comment
This comes as the French government backtracked from earlier statements suggesting it would block a foreign takeover approach for SocGen. The French Prime Minister Francois Fillon said yesterday: "The government has not vetoed anything. It is simply indicating its determination to ensure that the employees' interests, our country's economic interests are preserved."
This comes less than a week after he said: "The government is determined that Société Gé*érale remains a great French bank." This led the European Commission to warn the government off blocking any cross-border deal.