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TAKEOVER OF SOCIETE GENERALE : Congo Refutes Agreement with Vista Group

The government of the Republic of Congo has denied the sale of subsidiary Societe Generale Congo to the Vista Group, saying the French bank did not grant it a right of first refusal while Societe Generale claims to have respected the rules.

In a press release dated June 12, the Congolese Ministry of Finance said it was surprised by the announcement made by Societe Generale four days earlier, about an agreement for the sale of its subsidiaries in Congo, Equatorial Guinea, Mauritania and Chad.

The Minister of Finance, Jean-Baptiste Ondaye announced that his country will not sign this agreement which does not respect the commitments made by the French bank in a letter dated May 31, 2023. The transfer was made in violation of the statutes in force and the provisions of the Uniform Act relating to commercial company law and the Ohada economic interest grouping.

A situation that the leaders of the hexagonal bank will have to face in Chad and Equatorial Guinea where voices are raised to say no to this transaction. Jean-Baptiste Ondaye, Minister of Economy and Finance of the Congo, did not go through four paths to challenge the transfer of shares of Societe Generale to the Vista Group in the Republic of Congo. After expressing his astonishment at the announcement of the conclusion of a transaction to sell the shares held by Societe Generale within the Congolese subsidiary, the minister explains that since January 25, 2023, the Congolese state, co-shareholder of Societe Generale Congo, has “officially notified the Societe Generale Group of its intention to use its right of preemption in accordance with the statutes in force and the provisions of the Uniform Act relating to commercial company law and the Ohada economic interest grouping”.

According to the Minister, the Societe Generale Group cannot sign any agreement to sell its stake in Societe Generale Congo without prior presentation to the shareholder State the elements that will allow it to use its right of preemption (identity of the potential buyer, price and conditions envisaged), something to which the Societe Generale Group had committed itself to do in its letter addressed to the Minister of Economy and Finance on May 31, 2023.

Gabon’s decision is backed by Article 771-2 of the Ohada which provides that “it may be stipulated in the articles of association or the agreements that the shareholder who intends to sell all or part of his shares is obliged to notify it to one or more shareholders who may inform the transferor that they are exercising a right of pre-emption at the price and conditions that have been notified to him”.

This pushes Jean-Baptiste Ondaye to consider “the agreement of the Societe Generale Group ceding its participation to the Vista Group as null and void and does not exclude using a legal remedy against the Societe Generale Group”.

With a net proceeds of 24 million euros in Equatorial Guinea, 28 million in Congo and 30 million in Chad, the General is leaving these subsidiaries in CEMAC.

Societe Generale remains present in 13 African countries, including Senegal, Ivory Coast or Cameroon where it holds a leading position, as compared to the four countries from which it is withdrawing.

Sorelle Ninguem

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