Barclays didn’t buy ABN Amro. Its shareprice and capital ratios fell to the point where a rights issue become necessary. Fortis did buy ABN Amro (part of it anyway). And like Barclays, it needs money.
It’s not just a €1.5bn equity capital raising either, but also…
- Scrip dividend (+ €1.3bn)
- Sale and Lease back of property (+€1.5bn)
- Issuing new preference shares (+€2bn)
And…
- Disposals (+€2bn)
Fortis said it had reviewed its portfolio of activities and identified a number of additional non-core assets which could be divested.
ABN Amro, perhaps. That Fortis too was still hunting for acquisitions barely a month ago is either a testament to the supreme confidence management must have in themselves or supreme folly.
Here’s the killer point though. In its acquisition of ABN Amro, Fortis – indeed the whole RBS-led consortium – is said to have been advised solely by… Merrill Lynch, which pocketed (so it’s speculated) a cool £140m for its services.
Guess, then, who’s doing the bookrunning for Fortis’ emergency ABN cost us dearly “solvency acceleration plan”?
Related links
Fortis seeks to boost solvency by €8bn – FT
Battle of the banks – The Times