RBS consortium seals ABN Amro takeover, as chairman quits

LONDON (AFP) - - A European consortium led by Royal Bank of Scotland on Wednesday declared victory in the takeover battle for Dutch group ABN Amro, sealing the biggest takeover in banking history and prompting the resignation of ABN's chairman.

Rijkman Groenink stepped down after opposing the consortium's mostly cash bid worth 100 billion dollars (71 billion euros), which prevailed over an offer from British bank Barclays.

The consortium, also comprising Belgian-Dutch group Fortis and Spain's Banco Santander, will now break up ABN Amro -- a move criticised by Groenink.

The takeover is also expected to involve the loss of up to 19,000 jobs at ABN Amro.

RBS chief executive Fred Goodwin rejoiced in the victory but acknowledged that much work lay ahead.

"It is good to get to the end of what has been a very long road," Goodwin told reporters on a conference call. "There is still a huge amount of work out there to do," he added.

Axel Pierron, an analyst at financial consultants Celent, said it may be some time before the deal's real success is realised.

"Once the celebration is over, the real challenges involved in this acquisition will have to be faced. Chopping a large international bank like ABN Amro ... will not be an easy task, especially from an operational point of view," Pierron said.

"The next two years will be crucial in that respect and it is only then that we will able to fully evaluate the final outcome."

Initially, ABN Amro management had backed the bid from Barclays, but withdrew its support in June after the RBS consortium put more cash on the table.

Barclays' mainly shares bid had been worth about 63 billion euros when Britain's third biggest bank pulled out of the running last Friday.

The consortium Wednesday confirmed that shareholders representing about 86 percent of ABN stock had accepted its bid and announced plans to buy the remainder.

The ABN shareholders holding the remaining 14 percent will now have a further chance to accept the consortium's offer until the end of October, according to the statement.

The consortium requires 95-percent support to force remaining minority shareholders to accept the offer.

RBS and its partners declared their offer as "wholly unconditional" in a statement on Wednesday, meaning all of its takeover conditions had been met.

Barclays had abandoned its bid last week after securing less than 1.0 percent of ABN Amro shares.

The ABN Amro takeover surpasses the previous record for an acquisition in the banking sector which was when US group Travelers bought CitiCorp for 72.56 billion dollars in 1998.

In recent weeks, analysts had predicted a crushing win for the RBS-led takeover bid because it was higher and mainly in cash, compared with the Barclays offer that was mostly in shares.

The consortium's victory will herald the break-up of ABN Amro, which dates back to 1824 and was once regarded as one of the jewels of the Dutch economy.

Last month, Groenink hit out at the consortium's plans to break up the Dutch bank, while criticising the Barclays offer as being too low.

On Wednesday, he stepped down.

"Shareholders have now chosen the consortium's offer. That is why it is appropriate for me to make way for a successor who is willing and able to execute the consortium's plan," Groenink said in a statement.

Groenink was named chairman of ABN Amro in 2000.

Barclays had seen its bid -- originally valued at 67 billion euros -- eroded in recent weeks as its share price value was hit by the global credit squeeze.

Barclays had wanted to merge ABN Amro's operations to create a vast global giant.

The RBS team has won despite the sale of ABN's US unit LaSalle to Bank of America in a move many analysts viewed as a "poison pill" against the consortium's blockbuster bid.

The successful offer for the Dutch bank is pitched at 38.40 euros per ABN Amro share and is 93 percent in cash.

[Source]

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