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Saint-Gobain: reducing cross-shareholdings

29 December 1997: The French glass group Saint-Gobain has started moving out of cross-shareholdings with other French companies. It recently sold 600,000 shares in the utilities group Generale des Eau…

29 December 1997: The French glass group Saint-Gobain has started moving out of cross-shareholdings with other French companies. It recently sold 600,000 shares in the utilities group Generale des Eaux, (thus cutting its stake from 9.6% to 9%), and 750,000 shares in the insurance group Axa-UAP (reducing its holding from 0.45% to 0.22%). The disposals, which Saint-Gobain said would generate FFr 200-300 million (US$ 33.29-49.8 million) in capital gains, were not in the groups that many had expected. Saint-Gobain“s chairman, Jean-Louis Beffa, said in April that he would reduce cross-shareholdings, but placed particular emphasis on the holding company Suez. His decision indicated a preference for Generale des Eaux over Suez following its merger with the rival utilities group Lyonnaise des Eaux, which had the effect of diluting Saint-Gobain“s stake. Mr. Beffa said at the time he would “significantly” cut his Suez participation. The company said earlier this month, however, that it had not sold shares in either Suez or another cross-investor, BNP. Generale des Eaux said it had reduced its reciprocal stake in Saint-Gobain by a similar amount over the past few months, and did not expect any further changes in the cross-shareholdings.

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