Feeds

Egg flees France

Oeuf sur le visage

  • alert
  • submit to reddit

Boost IT visibility and business value

Egg, the UK e-bank, is fleeing France and 450 employees. The cost of extricating itself from this debacle is €170m.

Prudential, the insurance firm and majority owner of Egg, has put the group up for sale, and US credit card firms and UK banks are said to be sniffing. But Egg is unwilling to pump in the money to turn round the French subsidiary and neither are the potential buyers.

This is how Egg puts it:

"The [selling the company] process has progressed to a stage at which it has become clear that no potential purchaser has the appetite for the investment required to deliver the French business plan, and accordingly, the board of Egg announces today that it intends to begin to take the necessary steps to close its business in France.

Egg's withdrawal from France comes as little surprise, with City folk speculating about its departure as far back as October last year. In 2003, Egg France lost £89m, dragging the group into loss.

Egg opened in France in 2002, following the £3.5m acquisition of Zebank - the country's first e-bank owned by owned by Groupe Arnault and Dexia.

At the time Egg said it would spend around £15m in development costs plus £50m in marketing. It forecast that it would attract one million punters in the first three years and predicted it would make a profit by the end of 2004.

But early attempts to promote its credit cards misfired, and the company underestimated the hold of store cards on the French market. As early as May 2003, Egg said it would have to double its investment in France. ®

Related stories

Egg buys Zebank
Egg has found that France is, indeed, a different country
Egg to cut 70 jobs
Egg blames France for big losses
Egg attracts interest from Capital One

Maximizing your infrastructure through virtualization

More from The Register

next story
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Amazon Reveals One Weird Trick: A Loss On Almost $20bn In Sales
Investors really hate it: Share price plunge as growth SLOWS in key AWS division
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.