Barclays Bid For ABN Amro Fails

Barclays Bank has announced today that it has dropped its bid for ABN Amro after months of speculation that it would succeed in its takeover bid, after failing to find the backing of the required 80% of ABN Amro shareholders.

Barclays had been competing with a higher bid from the Royal Bank of Scotland and a related consortium of other major European banks, which would most likely see ABN Amro carved up proportionately between them.

After around eight months of speculation, Barclays set yesterday as the deadline for shareholders to make up their minds, which has now passed with less than the requisite 80% backing of the move. It is now thought that the move from the Royal Bank will be successful, which will eventually create one of the world’s largest banks.

The move has been seen by market analysts as a significant blow to Barclays, which had been intent on growing the size of its banking operation through Europe. Despite the failure to secured the bid, Barclays officials have maintained that the outlook for the bank remains strong, suggesting there may be more takeover propositions on the way.

The Royal Bank of Scotland bid, valued at just under £50 billion is expected now to proceed with the backing of the shareholders, predominantly as a result of its higher cash value. The Barclays bid had been valued at around 10 billion euros below the tabled offer by the RBS led consortium.

Shareholders at the RBS had backed the move to acquire the Dutch bank, although there was an overall feeling that such a significant outlay may be a risky move with the current banking market conditions.

However, officials from within the RBS have said that the move will help strengthen its position as a leading European and global bank as the markets move to recovery from the credit crunch and liquidity crisis of the summer.

Story link: Barclays Bid For ABN Amro Fails