Online brokerage E*Trade is to sell its 34 percent minority equity stake in CPR-E*Trade following disagreements with its French partner CPR over the future ownership and direction of the venture.
The divestiture, which will cost the US brokerage some Eur82 million, will result in the cancellation of the existing license agreement, returning exclusive use of the E*Trade brand to E*Trade Group and changing the CPR-E*Trade name.
E*Trade says the termination of the agreement will provide it with the opportunity to establish a majority owned position in France, in line with its strategy for European market penetration. The virtual brokerage currently operates ten retail-branded Web sites worldwide.
"Our agreement with CPR provides E*Trade with greater flexibility to deliver on our global electronic model and consolidate European revenues," says Christos Cotsakos, E*Trade chairman and CEO.
According to a recent study by J P Morgan, online brokerage accounts in France are expected to increase from 500,000 in 2000 to 2.5 million by 2003. The report also highlights that in the first six months of 2000 online brokers accounted for 11 percent of all executed transactions in France.