Shareholders approve Santander takeover
The European Commission also approves the takeover of British bank Alliance & Leicester by leading Spanish lender Santander.17 September 2008
MADRID -- Alliance & Leicester said Tuesday its shareholders and the European Commission had approved the takeover of the British bank by leading Spanish lender Santander.
Santander agreed with the management of A&L in July 2008 to acquire the UK lender by offering one of its shares for every three of A&L in a deal worth EUR 1.574 billion. The Spanish lender will also pump EUR 1 billion into A&L to increase its capital.
Over 96 percent of the voting rights represented at two A&L shareholders meetings yesterday declared in favour of Santander's offer. The deal is still subject to court approval but is expected to become effective on 10 October 2008.
"We welcome our shareholders' approval of the offer from Santander", A&L said in a statement to the London Stock Exchange.
"The economic outlook and continuing uncertainty in financial markets have reinforced the board's view that this transaction is in the best interests of shareholders, customers and other stakeholders", it added.
A&L is struggling with a sharp downturn in the domestic property market and tighter funding conditions.
A&L will boost Santander's presence in Britain where it bought Abbey National in 2004 for 9.2 billion pounds [EUR 11.5 billion]. The Spanish bank expects annual cost savings from the deal of EUR 180 million by 2011.
The EC said that while A&L and Abbey's activities overlap in a number of areas, the combined bank would have market shares of below 15 percent and would face strong competition from several UK banks.
"The Commission has, therefore, concluded that the proposed transaction does not give rise to competition concerns", the EC said in a statement.
[El Pais / A. S. / Expatica]