Belgian government to appeal court freeze on BNP's Fortis deal

16th December 2008, Comments 0 comments

Government decided at an emergency cabinet meeting to file a legal challenge.

BRUSSELS - The Belgian government will appeal a court ruling suspending the sale of the Belgian assets of banking and insurance group Fortis to French bank BNP Paribas, the prime minister's office said Monday.

The government decided at an emergency cabinet meeting to file a legal challenge as an interested third party and that the state's industrial holding company would lodge an appeal.

"The government confirms that for it the best guarantee for Fortis Bank Belgium's continuity is the continuation of the industrial project underway with BNP Paribas," Prime Minister Yves Leterme's office said in a statement.

The deal with the French bank, orchestrated by the Belgian government in October as Fortis battled to avert collapse, was due to close this week until a Brussels Court of Appeals suspended it on Friday.

The court ruled in favour of Fortis' minority shareholders who had challenged the deal on the grounds that they had not been consulted about the takeover and said a vote should be held by February 12 at the latest.

Shares in Fortis, considered among the bluest of Belgian blue chips until the bank ran into trouble, were widely held by individual investors, who saw their investments nearly wiped out when Fortis hit the rocks.

Many small investors considered that the state had rushed to sell Fortis' Belgian banking and insurance assets to BNP Paribas at a fire sale price of 14.7 billion euros (19.8 billion dollars).

The court ordered a group of experts to review how the assets were valued to judge whether the price was fair and also said BNP Paribas had to support the Belgian bank in the meantime if needed.


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