SocGen plays down takeover talk, says to sue Daily Mail -memo

By Lionel Laurent

(Reuters) - A takeover of Societe Generale (SOGN.PA) is not a solution to current woes nor is it at risk of taking place, the French bank told employees in an internal memo sent on Friday.

"A takeover, today, is neither a solution nor at risk : all banks have seen their share prices drop," the memo obtained by Reuters said. "The level of instability in the environment and the banking system means that all banks are faced with the same problem. It is not a solution to the current problem, regardless of the players."

The memo also said legal action against newspaper Daily Mail was pending after the Mail on Sunday published a story in August saying SocGen was close to collapse. The newspaper subsequently issued a public apology after SocGen denied the story.

"Legal action against the Daily Mail is pending and similarly legal action will be taken against anybody who spreads unfounded rumours about our company," the memo said.