9 October 2007

LONDON (AFP) - A European consortium led by Royal Bank of Scotland on Monday clinched a record 71-billion-euro takeover of ABN AMRO, paving the way for the break-up of the Dutch lender.

The RBS grouping, which also comprises Belgian-Dutch group Fortis and Spain's Banco Santander, said in a statement Monday that it had won backing from shareholders representing 86 percent of ABN AMRO shares.

The announcement effectively ends a titanic six-month takeover battle, with the deal representing the biggest-ever acquisition in the history of the European banking sector.

British bank Barclays had last week pulled the plug on its rival bid worth around EUR 63 billion after failing to secure enough ABN AMRO shareholder support.

"The minimum acceptance condition to the offer has been satisfied," the RBS consortium's statement said. In response, ABN AMRO issued a brief statement noting the announcement.

In recent weeks, analysts had predicted a crushing win for the RBS-led takeover bid because it was higher and mainly in cash, compared with the Barclays offer that was mostly in shares.

Monday's announcement will likely herald the break-up of ABN AMRO, which dates back to 1824 and was once regarded as one of the jewels in the crown of the Dutch economy.

ABN AMRO chairman Rijkman Groenink had last month criticised the Barclays offer as being too low, while hitting out at the consortium's plans to break up ABN AMRO.

Initially, ABN AMRO management had backed the Barclays takeover bid, but withdrew its support in June after the RBS consortium put more cash on the table.

The consortium has now triumphed -- in contrast with the failed Barclays bid that had aimed to merge ABN AMRO's operations to create a vast global giant.

The RBS team also won despite the sale of LaSalle to Bank of America in a move many analysts viewed as a "poison pill" against the consortium's blockbuster bid.

The successful offer for the Dutch bank is pitched at EUR 38.40 per ABN AMRO share and is 93 percent in cash. The takeover is expected to involve the loss of 19,000 jobs.

Under the deal, Santander will take over ABN AMRO 's Italian and Brazilian operations, while Fortis will assume its retail banking division based in the Benelux countries.

RBS would take cash from the sale of ABN AMRO 's US unit LaSalle as well as the group's institutional banking business and Asian retail banking activities.

ABN AMRO had last week finalised the sale of LaSalle to Bank of America for USD 21 billion (EUR 14.8 billion).

Barclays, Britain's third-biggest bank, had seen its share price hit by the global credit squeeze -- which had eroded the value of its original offer that was worth about EUR 67 billion.

In London share trading on Monday, the Royal Bank of Scotland failed to benefit from its announcement, its price dropping 1.58 percent to 560.50 pence.

On the Amsterdam stock exchange Fortis shares also dropped by 0.15 percent to EUR 2.54, while ABN AMRO climbed 0.24 percent to EUR 37.96.

In Madrid Santander lost 0.57 percent to EUR 13.86.

[Copyright AFP 2007]

Subject: Dutch news