The agreement covers three points:
- Co-marketed cards-The joint venture Between (55%-owned by BNP Paribas and 45%-owned by Cofinoga) will cease operations and all outstanding contracts will be managed by Cofinoga, including those involving BNP Paribas Lease Group and Banque de Bretagne.
- International business-Cofinoga will buy out BNP Paribas's share of the UK subsidiary Creation Financial Services (CFS), which was previously held on a 50/50 basis.
- Provisio cards-The partnership between the two groups concerning Cofinoga's management of this product will be pursued until it expires in December 2002.
At the same time, LaSer will increase its ownership interest of Cofinoga, from its present level of 51% (the other 49% being held by the BNP Paribas Group). For this purpose, BNP Paribas has granted LaSer an irrevocable purchase option for 5% of Cofinoga's capital stock, which may be exercised in 2001. The terms of the agreement are based on valuation multiples with respect to 1997, when BNP purchased its Cofinoga shares.
By means of this operation, BNP Paribas and LaSer aim to reaffirm Cofinoga's autonomy over its growth in France and worldwide. While strengthening LaSer‘s cohesion, the Galeries Lafayette group is reestablishing its economic control over card and credit operations involving its clientele.
Cofinoga is continuing to develop its strategy of growth and international alliances.