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Barclays' ABN Amro bid gets EC nod

06/08/2007

Barclays' takeover bid for Dutch bank ABN Amro has been given the go-ahead by the European Commission.

Under EU merger regulations the deal could have been prevented if their combined operations compromised competition.

As it is the high street lender has only marginal overlapping activities with its takeover target in England and is not currently active in ABN Amro's home market in the Netherlands, the EC has ruled.

This means the €65 billion (£43.6 billion) bid for the bank, launched earlier today, can go ahead.

The EC "concluded that the operation would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it", a statement said.

Barclays is hoping to beat a €71 billion (£48 billion) rival offer by a consortium which includes the Royal Bank of Scotland (RBS).

ABN's board withdrew its support for a Barclays takeover last month, saying that it wanted to ensure "a level playing field" for the competing bids.

In a statement today Barclays confirmed that its proposed cash and share offer for ABN will begin tomorrow and run until October 4th.

The British bank is offering ABN investors 2.13 new Barclays shares and €13.15 (£8.90) for each of their shares.

"Further to the announcement of July 23rd 2007, setting out the revised terms of Barclays' offer for the shares of ABN Amro Holding, Barclays announces that it has received the regulatory clearances required to publish its offer documentation and is formally launching its offer for ABN Amro, which will open for acceptance tomorrow," the group said.

The launch of Barclay's formal offer for ABN comes as the shareholders of one of the companies involved in the rival RBS bid prepare to vote on whether to back the second takeover approach.

Investors at Belgian-Dutch bank Fortis will decide later today whether to back the offer for ABN proposed by the company's board.

They will also decide whether Fortis should issue €13 billion (£8.79 billion) in shares to fund the bank's part of the consortium deal, which along with RBS also includes Spain's Santander.

Meanwhile ABN has announced that it intends to hold an extraordinary meeting of its shareholders on September 20th to discuss the rival offers put forward by Barclays and the RBS consortium, with the Dutch group facing the biggest bank takeover ever made.

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