RBS Acquisition of ABN Amro More Likely Than Ever

In the battle for ABN Amro, the consortium of RBS, Fortis, and Santander has

now clearly bested its rival, Barclays. The RBS consortium’s bid is about 20%

higher than Barclays’ bid, thanks largely to Barclays’ sinking stock price,

and Barclays now looks much more like a takeover target itself than a serious

suitor for the Dutch giant.

And so it is that the RBS consortium, having seen off Barclays, is now turning

its attention to the one last obstacle standing in its way: ABN Amro’s shareholders.

They might prefer the consortium’s bid to Barclays’ bid, but what if a lot of

them prefer no bid at all, and would rather their bank remain independent? At

the moment, the consortium requires 80 percent of ABN shareholders to accept

its offer for it to be declared unconditional, which means that an apathetic

20%, simply not voting at all, could throw a nasty spanner in the works.

So the 80% figure might not last long: the consortium announced

today that it might accept just a simple majority of acceptances. The move

makes the consortium’s bid seem a little bit weaker than it was before, but

that’s not a major worry: after all, to all intents and purposes the consortium

is now the sole bidder for ABN Amro. There might be a small question mark over

getting 80%, while 50% is a foregone conclusion, thanks to the number of arbitrageurs

in the stock.

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