Hedge Fund Threatens Legal Action Unless ABN AMRO Listens to All Offers

Dutch daily Financieele Dagblad reported Monday morning that British hedge fund TCI has threatened to take legal action against ABN AMRO, which is currently in merger talks with Barclays, unless the Dutch banking giant considers other offers for its business. TCI (The Children's Investment Fund Management) urged ABN AMRO in February to either break up or sell itself, triggering its talks with Barclays; the funds owns about 2% of ABN. TCI insists ABN should consider all options before agreeing to the Barclays deal; Barclays and ABN have reportedly agreed to exclusive talks for 30 days. The proposition calls for a combined bank that would be listed on the London Stock Exchange and headquartered in Amsterdam; the CEOs of both companies would co-head the new bank. The merger would create the world's #5 bank with a market value of over £80 billion. Separately, Toscafund declined to comment on rumors it would accept a quick sale of its more than 1% ABN holding to Barclays.

Sources: Reuters, AFX News
Commentary: Memo to Barclays: ABN Amro's US Banks Are a Mixed Bag • Barclays To Acquire ABN : Long-term Investor Horizon Required • The Long Case for Barclays
Stocks/ETFs to watch: ABN Amro Holding N.V. (ABN), Barclays PLC (BCS). Competitors: HSBC Holdings plc ADR (HBC), Deutsche Bank AG (DB), UBS AG (UBS), Citigroup Inc. (C)

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