RBS Consortium Adds to ABN Amro Stake

The Royal Bank of Scotland-led consortium that is challenging Barclays for control of ABN Amro purchased more than 3% of the Dutch bank over the past two trading days. The consortium bought the stake -- 40.76 million shares, bought at an average price of €33.81 -- between last Friday, when the shares were trading as low as €31.20, and Monday. ABN's shares skidded 11% Friday on fears that the turbulent market might prompt the consortium to pull its offer. They closed up 1.86% at €34.48 Monday. The consortium's offer is worth about €38 a share, or €71 billion ($96.6 billion). The other members of the consortium, the Spanish bank Santander and the Belgo-Dutch group Fortis, have both received approval from their shareholders to proceed with the bid. The Dutch finance ministry, meanwhile, has granted Barclays a declaration of no objection, or DNO, enabling it to proceed with its offer provided it submits a "detailed integration plan" within two months of the transaction's completion. The DNO represented the last regulatory hurdle facing Barclays' proposed friendly takeover. "The DNO instructions are in line with our existing plans, and we anticipate no difficulty in complying with these requirements," said Barclays CEO John Varley.

Sources: Financial Times, MarketWatch, Dow Jones
Commentary: ABN Amro Plunges on Rumors Buyout May Fall Through • ABN AMRO: Subtle Valuations In Takeover Battle • ABN Amro Takes Neutral Position Toward Bidders
Stocks/ETFs to watch: ABN, RBSPY.PK, BCS, FORSY. Competitors: HBC, DB, UBS. ETFs: RKH, EWN, KBE
Earnings call transcripts: ABN Amro Q2 2007

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