Stand up for nonprofit news & help us reach our $150k stretch goal! GIVE NOW

Barclays losing ABN AMRO deal

Stephen Beard Oct 4, 2007


Doug Krizner: It appears the British bank Barclays will admit defeat in the battle to takeover the Dutch bank ABN Amro. This banking deal has been dragging on for months. But as Stephen Beard reports, today there might be a resolution.

Stephen Beard: Barclays lost out because it was offering its own shares to buy ABN Amro. And as the subprime crisis unfolded during the summer, those shares fell sharply.

Meanwhile, the mostly cash offer from the rival bidder has looked increasingly tempting.

This may, however, be the best deal Barclays never did. They get a break fee worth more than $300 million. And they’ll no longer be lumbering themselves with a large acquisition just as the banking business takes a turn for the worse.

The consortium led by the Royal Bank of Scotland now looks certain to clinch the deal. But buying ABN AMRO for top dollar at a time like this may well prove a mixed blessing.

In London, this is Stephen Beard for Marketplace.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.