July 27 (Bloomberg) -- Credit Suisse Group AG, the largest shareholder in EcoSecurities Group Plc, cut its stake in the emissions trading firm at the same time a former UBS AG executive is backing one of two proposed takeover bids.

Credit Suisse, the biggest bank in Switzerland by market value, owned 14.5 percent of EcoSecurities as of July 16, down from 15.4 percent before, according to Hugin newswire statements. Dublin-based EcoSecurities manages the biggest number of emission-reduction projects overseen by the United Nations, Bloomberg data show.

Two years ago, Credit Suisse bought about 9.2 million shares of EcoSecurities at 320 pence each, “underscoring our deep commitment to this important high-growth sector,” Investment Banking Chief Paul Calello said at the time. EcoSecurities has since plunged, trading today at 87.5 pence in London. A group including Andre Esteves, former head of fixed income, currencies and commodities at Zurich-based UBS, offered 77 pence a share for EcoSecurities on July 16.

That bid is unlikely to succeed, said Agustin Hochschild, an analyst in London for Mirabaud Securities LLP. “Unless someone has to liquidate their holdings, I don’t think they should sell below three digits,” said Hochschild, who estimates the shares have a “bare, bare bones value” of 113 pence.

Credit Suisse Securities (Europe) Ltd., a unit that invests in stocks, held 7.2 million shares of EcoSecurities as of July 16, according to a statement. That’s down from 8.3 million shares on June 9. Credit Suisse International, the unit that bought EcoSecurities stock in 2007, owned 9.9 million shares, the same as last month.

Exit Strategy

Credit Suisse spokeswoman Sofia Rehman in London declined to comment on EcoSecurities. Zurich-based Credit Suisse said in February it’s exiting investment-banking businesses, including power and emission trading, that lost 14.6 billion Swiss francs ($13.7 billion) in 2008.

Second-quarter profit at Credit Suisse rose 29 percent as revenue from trading stocks and bonds doubled, the bank said July 23. Net income increased to 1.57 billion Swiss francs, or 1.18 francs a share, from 1.22 billion francs, or 97 centimes, a year earlier.

Guanabara Holdings BV, a Dutch firm set up to bid for EcoSecurities, announced a cash offer on July 16 that values the emissions trader at 91 million pounds ($150 million). The bid is fair and offers EcoSecurities shareholders a way out of their “suffering,” Guanabara Chairman Pedro Moura Costa said in an interview last week.

‘Extremely Promising’

Moura Costa is a co-founder of EcoSecurities and served as president until announcing his resignation on April 23. He described the company as “extremely promising” in a statement that day and added: “I believe in the long-term success of EcoSecurities.”

Moura Costa said he and Esteves’s BTG Investments LP own about 12 percent of EcoSecurities. BTG may become one of the largest investment banks in emerging markets following its $2.5 billion agreement in April to buy UBS’s Pactual unit in Brazil, according to Guanabara’s offer document sent last week to shareholders.

Guanabara’s offer is “wholly inadequate” and shareholders shouldn’t accept it, EcoSecurities said in a July 23 statement. The company is preparing a formal response to Guanabara, Kevin Smith, an EcoSecurities spokesman, said by phone on July 24.

Guanabara is one of three firms to consider bidding for EcoSecurities this year. The Dublin trader rose to a one-year high last week after Tricorona AB, a carbon-credits developer based in Stockholm, said it may offer an undisclosed amount, rivaling Guanabara. “There can be no certainty that an offer will be forthcoming,” Tricorona said in a July 21 statement.

Withdrawn

Electricite de France SA, Europe’s biggest power producer, said July 16 it won’t proceed with a possible offer for EcoSecurities. The board of the carbon developer rejected a bid by EDF at 96 pence a share.

Credit Suisse will probably wait to see if Tricorona “comes in with a real bid,” Adam Forsyth, an analyst with Matrix Corporate Capital LLP in London, said today by phone. He values the stock at about 103 pence as long as UN certified emission credits trade at 12 euros ($17.53) a metric ton.

Tricorona may bid more than 84 pence, Andrew Shepherd- Barron, a London-based analyst at broker KBC Peel Hunt Ltd., said July 22 in a research note.

EcoSecurities specializes in greenhouse-gas-reduction projects sponsored by the UN’s Clean Development Mechanism. They can be used for compliance in the European Union carbon market, the world’s biggest.

Carbon Credits

It held 103 million metric tons of credits as of Dec. 31, 2008 expected to be delivered by 2013, according to its annual report. The average acquisition price for its holdings was 7.84 euros per credit, the statement said.

The developer said it held 132 million credits at the end of last year for deliver after 2012. The company reported a loss of 32.2 million euros last year, which was narrower than the loss of about 45 million euros in 2007.

EcoSecurities fell 93 percent in the past two years as the recession curbed industrial output as well as demand for emission credits. Furthermore, UN regulators have scrutinized projects that generate the tradable credits. The shares have jumped from a record low 17.5 pence in March on takeover speculation.

To contact the reporter on this story: Mathew Carr in London at m.carr@bloomberg.net

Last Updated: July 27, 2009 12:34 EDT