Luck of the Irish

6 October 2003 By Chris Hughes

The UK bank seems to have got a decent price for the mortgage bank although the deal is more about driving revenues than cutting costs. Peers in First Active’s Irish heartland might theoretically be able to pay more but they would probably be blocked by antitrust authorities.

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Royal Bank of Scotland said it had agreed to buy First Active, the Irish mortgage bank, for E887m, or E6.20 a share. The consideration represents a 33% premium over First Active's closing price prior to the announcement.

First Active's chief executive and finance director, as well as four nonexecutive directors, are to join Ulster Bank's board.

RBS chief executive Fred Goodwin said: The combination of First Active and Ulster Bank will provide significant impetus to the Royal Bank of Scotland's operations in the Irish financial services market.

The deal requires the approval of majority of shareholders by number, but only as a proportion of voting turnout.

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