ABN Amro mulls break-up vote
ABN Amro mulls break-up vote
By Ian Bickerton in Amsterdam and Jane Croft in London
Copyright The Financial Times Limited 2007
Published: March 28 2007 03:00 | Last updated: March 28 2007 03:00
ABN Amro, the Dutch bank courted by Barclays of the UK, is expected to meet all the demands of activist investors by including a break-up vote on the agenda, published today, of its April annual meeting.
The decision reflects the fact that ABN does not want to risk provoking investors during the Barclays talks, which are aimed at creating the world's fifth largest bank with a market value of more than $175bn.
It also underscores a view within ABN that many shareholders believe the takeover negotiations have superseded the demands levelled a month ago by minority investor The Children's Investment Fund (TCI).
ABN has undertaken a comprehensive sweep of shareholders since TCI issued its call, and will approach next month's annual meeting in The Hague confident of supportfrom its investor base.
The bank is understood to believe that few shareholders would risk a move that could jeopardise the bank's sale. Analysts expectBarclays to table a bid of about €35 a share, mostly in shares. ABN declined to comment.
TCI has called for five resolutions to be added to the agenda, the most radical being calls for a break-up, sale or merger of the bank.
In order for ABN not to include the resolutions, it would need to have demonstrated a conflict with the interests of the bank.
Lawyers could have argued that the Barclays discussions provided the perfect opportunity to cite that clause. However, ABN is understood to have chosen not to go down that road, and by so doing will hope to demonstrate that it takes shareholder views seriously.
It will be aware, too, that TCI has a formidable reputation for shareholder activism. The London-based hedge fund has made clear to ABN that it wants the bank to consider all options for a sale, and not simply to talk to Barclays, with which it has entered a period of exclusivity.
Analysts believe a number of rival bidders may be waiting in the wings, including Citigroup, HSBC, Royal Bank of Scotland and Santander, any of which could generate greatersynergies than Barclays.
Bob Diamond, president of Barclays, yesterday stressed that the Barclays takeover approach was in line with the bank's previously stated strategy.
Speaking at the Morgan Stanley European banksconference in London, Mr Diamond said Barclays was "in a strong position" in its talks with ABN.
In his speech he set out the main trends driving future opportunities in investment banking and asset management.
By Ian Bickerton in Amsterdam and Jane Croft in London
Copyright The Financial Times Limited 2007
Published: March 28 2007 03:00 | Last updated: March 28 2007 03:00
ABN Amro, the Dutch bank courted by Barclays of the UK, is expected to meet all the demands of activist investors by including a break-up vote on the agenda, published today, of its April annual meeting.
The decision reflects the fact that ABN does not want to risk provoking investors during the Barclays talks, which are aimed at creating the world's fifth largest bank with a market value of more than $175bn.
It also underscores a view within ABN that many shareholders believe the takeover negotiations have superseded the demands levelled a month ago by minority investor The Children's Investment Fund (TCI).
ABN has undertaken a comprehensive sweep of shareholders since TCI issued its call, and will approach next month's annual meeting in The Hague confident of supportfrom its investor base.
The bank is understood to believe that few shareholders would risk a move that could jeopardise the bank's sale. Analysts expectBarclays to table a bid of about €35 a share, mostly in shares. ABN declined to comment.
TCI has called for five resolutions to be added to the agenda, the most radical being calls for a break-up, sale or merger of the bank.
In order for ABN not to include the resolutions, it would need to have demonstrated a conflict with the interests of the bank.
Lawyers could have argued that the Barclays discussions provided the perfect opportunity to cite that clause. However, ABN is understood to have chosen not to go down that road, and by so doing will hope to demonstrate that it takes shareholder views seriously.
It will be aware, too, that TCI has a formidable reputation for shareholder activism. The London-based hedge fund has made clear to ABN that it wants the bank to consider all options for a sale, and not simply to talk to Barclays, with which it has entered a period of exclusivity.
Analysts believe a number of rival bidders may be waiting in the wings, including Citigroup, HSBC, Royal Bank of Scotland and Santander, any of which could generate greatersynergies than Barclays.
Bob Diamond, president of Barclays, yesterday stressed that the Barclays takeover approach was in line with the bank's previously stated strategy.
Speaking at the Morgan Stanley European banksconference in London, Mr Diamond said Barclays was "in a strong position" in its talks with ABN.
In his speech he set out the main trends driving future opportunities in investment banking and asset management.
posted by Carlos T Mock @ 6:30 AM
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