Business Case Studies, Mergers, Acquisitions and Takeovers Case Study, Citigroupís Acquisition of Egg Bank,The Spin-Offs

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Mergers, Acquisitions and Takeovers Case Study

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Case Title:

Citigroupís Acquisition of Egg Bank: The Spin-Offs

Publication Year : 2007

Authors: Rajan Shah, Ruchi Mankad

Industry: Banking, Insurance and Financial Services

Region:US

Case Code: MAA0104A

Teaching Note: Not Available

Structured Assignment: Not Available

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Abstract:

Egg Banking plc (Egg), a UK based online financial service provider was part of Prudential plc, leading insurer globally. Egg had created strong brand name in UK market by providing innovative products in banking, investment and insurance. It had 5% share in UKís credit card market. But, France operation of Egg bank remained unprofitable and in 2004 it existed from French market to focus on UK business. Meanwhile, condition in UK unsecured market badly affected to Eggís performance and in 2006 it reported loss reported loss of £145 million.

In 2007, Citigroup acquired Egg bank for £575 million ($1.13 billion) in cash from Prudential. Citigroup expected to have synergies in terms of Eggís customer base and brand name that it had created in UK market.

The case details about Citigroupís inorganic growth strategies in UK market. Also, it details about how Citigroup be able to capitalize the acquisition and able to create leadership position UKís financial market.

Pedagogical Objectives:

  • To understand business spin-offs
  • To study the online banking scenario in UK market
  • To understand inorganic growth strategy
  • To understand competitive scenario in online banking market.

Keywords : Mergers,Acquisitions,Alliances Case Study;Online Banking Sector; Egg Bank; Prudential Plc.; Market Development Strategies; Targeting New Product Segment; Competitive Scenario; Wealth Maximization; Citigroup; Citigroup in Britain; Unsecured Lending Market; Egg Bank in France; Citigroupís Acquisition of Egg Bank

Contents : 
Egg Banking Plc
Major Products- Business Review
Acquisition of Egg Banking Plc
Major Developments and Achievements
Diversification of Income by Regions

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