A little more clarity

29 May 2007 By Edward Hadas Follow @edwardhadas

The RBSled group has put its cards on the table. What s new? A little more cash, and the assumption of the potential LaSalle liability. But the bid still faces big road roadblocks, including full regulatory approval and shareholder votes from ABN and the three bidding banks. But the bid still faces big road blocks, including full regulatory approval and shareholder votes from ABN and the three bidding banks.

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The consortium of Royal Bank of Scotland, Santander and Fortis have made an offer for ABN Amro of E30.40 a share and 0.844 shares of RBS. The value per share is E38.40 and the total value is E71bn.

The full cash payment will only be delivered if the consortium does not have to pay Bank of America to settle the US bank's claim that is has a binding contract to buy LaSalle, a US bank, from ABN Amro. The shareholders' payment can be cut by as much as E1.8bn.

The offer is fully underwritten by Merrill Lynch. Fortis will issue E15bn of new shares, while Sandander will issue E10bn. Fortis will also issue E5bn of new Tier 1 capital notes, while RBS will issue E6bn.

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