The talks have been “amicable and professional” said Sir Fred Goodwin. But they’re also over.
RBS’s chief executive on Tuesday unveiled details of the consortium’s €71bn offer for ABN Amro – but there’s still a major sticking point: The group’s discussions with Bank of America about the future of LaSalle, the US bank, are “not ongoing.”
The matter was now, said Sir Fred, a matter for the courts and for shareholders. The consortium’s bid hinges on retaining control of LaSalle, which ABN agreed to sell to BofA for $21bn as part of its agreed deal with Barclays and the RBS-led group had been discussing buying parts of the US bank in return for dropping its interest in the subsidiary. A Dutch court ruled that ABN must put the sale to its shareholders, prompted an appeal by ABN against the decision and a US lawsuit to be filed by Bank of America.
The consortium’s offer values ABN at €38.40 a share, with 80 per cent now in cash and the remainder in RBS shares. Of the total €71bn, RBS will pay €27.2bn for LaSalle and ABN’s global wholesale business, excluding Brazil.
For Fortis, the purchase of ABN’s business in the Netherlands, and the asset management and private client business globally for €24bn, will involve a vast €15bn rights issue and a further €8bn raised through the sale of non-core assets.
Santander looks positively moderate with a €9.5 to €10bn rights issue to fund its purchase of the Latin American business and Antonveneta. That will cover around half of its bill with the rest likely to come from debt, and assets sales.