ABN Amro withdraws backing for Barclays' Bank bid

30 July 2007

ABN Amro's board has announced it is dropping its support for Barclays Bank's buyout bid.

However, the firm added that it will not be endorsing the Royal Bank of Scotland-led consortium's higher offer, which also includes a larger cash component.

A statement issued by ABN Amro, which was previously perceived to favour Barclays' bid, said that it could not recommend either offer owing to "significant unresolved questions".

The statement added: "ABN Amro will further engage with both parties with the aim of continuing to ensure a level playing field and minimising any of the uncertainties currently associated with the offers with a view to optimising the attractive alternatives available to ABN Amro's shareholders."

Barclays' bid currently stands at $87.5 billion, while the consortium's rival offer is worth $96.6 billion.

News of developments in the takeover battle follows reports that a group of hedge funds approached Barclays about acquiring voting-rights shares in consortium partner Fortis.

Had Barclays accepted the plan, the hedge funds would have used the shares to vote against Fortis' proposed £8.7 billion rights issue, which is intended to raise funding for the ABN Amro takeover.

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