BNP Paribas this morning announced its purchase of the Fortis Bank's Belgian operation.  The good news for Fortis retail outlet employees is that there will most probably be no danger of losing their jobs.  BNP has a very small presence in Belgium so there will be no cost savings to make from eliminating overlapping agencies or by making redundancies.  Life has been hard for many Fortis employees over the past couple of weeks, especially with the humiliation of having to sell ABN Amro at less than half what was paid little over a year ago.  So I hope they will be able to breathe a sigh of relief this morning and see this as a light at the end of the tunnel.  The fact that the Belgian State is now a shareholder in BNP Paribas should help Belgians to avoid the feeling that another important part of their economy, after Electrabel, has disappeared into French ownership. 

On October 2 Global Finance magazine ranked BNP Paribas as one of the World's strongest banks.  With the Belgian State now owning 12% of the Bank, as a result of the Fortis Deal, BNP Paribas would in all likelihood be rated even stronger only eight days later.  The Universal Banking model it has adhered to over the past few years and its strong deposit base have positioned it well to make more take-overs.  This morning it has let it be known that the next purchases will perhaps be in the United States, through its small Bancwest subsidiary.



Since being divested by Total to its shareholders in 2004 at €27 the Arkema shareprice has increased by 85% and it is now nearing €50.  Thierry Le Hénaff, the dynamic PDG (CEO) of Arkema, whom I recently heard on BFM business radio in Paris, seems to be revelling in his new found freedom.

The Arkema board meeting in Paris yesterday voted a share buyback program, but Le Hénaff states clearly that his strategy is one of investment, both in organic growth and in acquisitions.  He will soon have divested about €400 million of non-core assets and this will allow him to muster a sum of about €800 million for acquisition of small, specialized companies that fit his three-pronged strategy (vinyls, industrial chemicals and products to improve performance) and help him to make the overall business less cyclical and produce higher margins.

Le Hénaff also intends to invest about €300 million annually to make the overall business more compeititive.  Three percent of turnover will be invested annually in R&D, to strengthen the industrial capacity of Arkema based on its present resources and capabilities.  At present only about 13% of Arkema's sales happen in Asia, so sales growth in that part of the world will be a priority for him.  

As of today, Arkema has a turnover of €5.7 billion, has 80 plants throughout the world and employs about 17.000 people.  To learn more you can read this morning's financial newspapers, Les Echos or La Tribune (which, by the way, just earned an award for being one of France's best newspapers, based on its combined print and web presence).


Will Orascom, the growing Egyptian mobile telephone operator, take over Bouygues Télécom, the third biggest operator in France?  Bouygues Télécom provides most of the free cash flow available to its parent, Bouygues, the giant construction company.

Will Vallourec, the steel tubes manufacturer whose shares have increased by nearly 50% over the past couple of months, thanks to its involvement in the petroleum industry, be taken over by Arcelor-Mittal, by Gazprom or the Russian billionaire Roman Abramovitch?  The President of Vallourec, Pierre Verluca, seems to have a "never say no" strategy while playing his cards close to his chest and saying that Vallourec can continue to function perfectly well as a standalone operator.  He has said that Vallourec can also be a predator, with up to one billion euros available to purchase the company that provides the right fit.