RBS Says It's Not in Talks With Bank of America to Resolve LaSalle Sale

Royal Bank of Scotland CEO Fred Goodwin said Tuesday his company was not in talks with Bank of America Corp. in an attempt to resolve the purchase of LaSalle Bank. ABN agreed in April to sell LaSalle to BoA for $21 billion, and at the same time to sell itself to Barclays Bank. A Dutch court froze the LaSalle sale and ordered that it be subjected to a shareholder vote. In the meanwhile, RBS made a hostile bid for ABN that bested Barclays' bid, but said it wants all or part of LaSalle, and made its offer contingent on the cancellation of ABN's deal with BoA. BoA has sued ABN to enforce the sale. On May 31, the Wall Street Journal reported that RBS and BoA had discussed dividing LaSalle, and that they were near an agreement when talks had to be suspended so RBS could make its €71.1 billion ($95.6 billion) bid for ABN. The Journal said talks were expected to resume, and that Goodwin was expectant of an agreement. It said the deal would give RBS LaSalle's commercial business, Michigan branches, HQ building and brand name, while BoA would take the 141 LaSalle retail branches based in Chicago. But in a conference call Tuesday, Goodwin apparently backtracked, saying of the LaSalle negotiations, "I don't see any particular urgency on the subject... I'm happy to have a conversation, we've had one before... if one happens it happens, if it doesn't it doesn't." RBS also said its plan would result in fewer job cuts (19,000) than Barclays' (23,600) -- both estimates exclude LaSalle.

Sources: Reuters, Seeking Alpha
Commentary: ABN Mulling RBS Consortium Bid; Supervisory Board Enters Takeover Fray • ABN Amro Opposes RBS-Led Rival Bid for LaSalle • ABN Shareholders Determined to Thwart LaSalle Sale to BoA; RBS-Led Consortium Reiterates Rival Bid
Stocks/ETFs to watch: ABN Amro Holding N.V. (ABN), Barclays PLC (BCS), Royal Bank of Scotland Group plc [ADR] (RBSPY), Fortis NV [ADR] (FORSY), Bank of America Corp. (BAC). Competitors: HSBC Holdings plc ADR (HBC), Deutsche Bank AG (DB), UBS AG (UBS). ETFs: iShares MSCI Netherlands Index (EWN), streetTRACKS KBW Bank (KBE), HOLDRS Regional Bank (RKH)

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