Chickening out

22 October 2003 By Chris Hughes

The UK bank is looking for a partner to stump up extra investment in its lossmaking French business. But closure has probably just been deferred. In the meantime, Egg shareholders are footing the bill for management s show of defiance.

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Egg, the UK internet bank, said it was in negotiations with potential partners to put its lossmaking French business into a joint venture.

It said the revised business plan for the unit unveiled alongside its firstquarter results would take more time and money than previously anticipated.

We believe it is in the best interests of Egg's shareholders to form an alliance with a strategic partner, said Paul Gratton, the chief executive. We anticipate that these negotiations will be concluded by the end of this year.

Egg also reported a pretax loss of £25m for the first nine months of 2003, against a loss of £3.9m in the same period in 2002. The company's French operations lost £70m in the period, and £21m in the third quarter.

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