ABN shares surge after Barclays buyout bid

20 March 2007

News of Barclays Bank's buyout bid for ABN Amro has seen shares in the Dutch bank surge by 4.1 per cent to a record price of $41.6 per share - equivalent to a $78.5 billion valuation for the company.

Meanwhile, Barclays' valuation also improved to $87.5 billion as its share price grew by 2.3 per cent.

Reports that Barclays had approached ABN Amro with a view to an $80 billion takeover were last night confirmed in a statement that said that the two banks were in talks about "a potential combination of two organisations".

Details of the terms of the deal are still unconfirmed, but reports in a London newspaper today suggested that Barclays' chief executive John Varley is considering moving the bank's base from Canary Wharf to Rotterdam.

It is thought that moving the British bank's headquarters to Holland will make Dutch shareholders more inclined to approve the proposed deal.

Should the takeover go through, it will create a financial services group worth $166 billion and would represent the largest-ever cross-border banking transaction.

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