Take up of Egg's French card has not been as successful as expected

The firm said its French business needs more investment than it is prepared to stump up itself.

Talks should finish by the end of this year, it added.

Egg made the announcement as it unveiled pre-tax profits for the three months to the end of September of �20m ($33.5m) at its main UK business, up from �9.4m a year earlier.

Most analysts had expected the bank to cut its losses and withdraw from France after the group found that the uptake of its main product there, La carte Egg, had been a lot slower than anticipated.

Chief executive Paul Gratton said: "We believe it is in the best interests of Egg's shareholders to form an alliance with a strategic partner.

"We are in negotiations which may lead to a joint venture or other transaction."

Strong UK growth

Egg said group pre-tax losses spiralled to �24.9m over the nine months to September, after a �69m loss at Egg France cancelled out a �56.7m profit at Egg UK.

But Mr Gratton added: "The UK business is growing strongly.

"Sales performance remained strong on a seasonally adjusted basis in the third quarter with 145,000 customers acquired compared to 107,000 in the same period last year."

The group also said it would cut about 70 jobs in the coming months in order to trim costs.

Egg employs about 2,600 people in the UK, with 2,000 working at its call centres in Derby and Dudley and its head office in London.

Spokesperson Emma Byrne said most of the job losses were likely to be in London.

"We don't expect our call centres in Dudley or Derby to be affected, as the people there are not involved in our international plans," she said.

The restructuring plans are expected to cost around �5m, but will mean annual savings of around �7m, Egg said.