The Dutch Supreme Court has followed the advisory opinion of the Advocate-General and ruled that the sale of LaSalle to Bank of America can go ahead without shareholder approval. The court added that it did not consider the sale, hatched as part of an agreed tie-up with Barclays back in April, to be an anti-takeover measure.
So what now?
Dresdner Kleinwort earlier this week produced a report, written by Tania Gold, addressing just this question - and in particular how the RBS-led consortium might react to such a decision.
We suspect that DK may be on, or very close to, the money with their musings. We suspect this because the PRs acting for the RBS gang subsequently emailed the note round - no message, just disseminating information, you understand.
The consortium should modify the terms of its proposed offer, and bid for ABN-ex-LaSalle, say DK. This could be achieved through presenting a completely new offer, or by waiving the conditions of the original proposed offer.
Without LaSalle, RBS’s total consideration should be much lower than the €27.2bn under the original terms.
There is, points out Gold, a considerable lack of visibility here as RBS never disclosed what portion of that was for LaSalle - but the perceived reduction in RBS’s skin in this game helped the shares gain 7p, or 1.1 per cent, on Friday morning.
Despite this lack of visibility, it is clear that without LaSalle the capital increase needed by RBS should be less than half that required initially. This leads us to believe that RBS could follow the example of Fortis and SAN, and carry out a separate capital increase, making the ABN bid an all-cash bid.
There is also the option of using bridge financing for the purchase of ABN, which could then be repaid with cash from the Dutch bank’s balance sheet, following the sale of LaSalle.
If the group just waives the conditions on the original offer, the price of €38.4 stands, suggests Gold, as the €1 deferred pending resolutions of the LaSalle question likely gets added back.
Of course, in a new offer, the group could argue that ABN-ex-LaSalle-plus cash is worth less than the entire business they originally signed up to buy.
The prospect of a modified all-cash offer, at €38.4, puts Barclays under pressure, say DK. With the LaSalle question settled, the battle for ABN actually becomes an even playing field - and the value of the UK bank’s offer for ABN is still trailing the consortium’s.
