BNP Paribas has ended months of speculation with the confirmation that Paribas Affaires Industrielles (PAI), the French bank's private equity affiliate, has spun itself out of the parent bank.

Under the terms of the agreement, PAI's investment team, led by Daniel-Amaury de Seze, chairman and chief executive of PAI, have acquired a 51% ownership interest in the private equity house for an undisclosed sum. BNP Paribas will sell the remaining interest in PAI between December 31, 2005 and December 31, 2007.