The three-bank consortium led by Royal Bank of Scotland that just purchased Dutch bank ABN Amro for $101 billion will begin to take control when its executives are named to ABN's supervisory and management boards, the FT reported Thursday. RBS CEO Fred Goodwin and the CEOs of Fortis and Santander will join the supervisory board. ABN CEO Rijkman Groenink said he will resign his position when the bank confirms the new board appointments. "During the first 45 days (of ownership) we intend to validate our base-line plans for the changes intended for ABN Amro and the transfer of businesses to the appropriate consortium partner," the trio said. The banks plan to cut jobs in the short term but add them in the long term. Most of management will stay in place, in part to satisfy Dutch regulators concerned about ABN's stability during the breakup. On Wednesday, following the completion by Fortis of a €13 billion rights issue that was the final link in the financing of the mostly cash deal, the consortium declared its bid unconditional. Arthur Martinez, the chairman of ABN's supervisory board, said the deal is good for shareholders. "No one likes the sort of emotional aspect of dismembering any institution," he said, "But this is a very Darwinian world in which we live these days...It was a fantastic price."
Sources: Financial Times, AFP, AP, Reuters, Wall Street Journal
Commentary: RBS Must Now Justify ABN Amro Purchase - Bloomberg • ABN Amro Shareholders Expected to Approve Consortium Takeover On Friday - WSJ • Winner of the Day: Santander
Stocks/ETFs to watch: ABN, FORSY, RBSPY.PK. Competitors: HBC, DB, UBS. ETFs: RKH, EWN, KBE
Earnings call transcript: ABN Amro Q2 2007
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