Allied Journal


Abbey agrees to Spanish takeover
26 Jul 2004

Abbey National, Britain’s second biggest mortgage lenderhas agreed to be taken over by Spain's biggest bank, Banco Santander Central Hispano (BSCH), in a deal valued at about £8bn ($15bn).

The deal will catapult Spain's largest bank into the world's top 10 and give BSCH an 11 per cent slice of the UK banking market with access to Abbey's 741 branches.

Abbey National has more than 16 million customers and assets of £177bn as of end-2003

Abbey shareholders are being offered one share in the buyer, Banco Santander Central Hispano, plus 31 pence in cash for each of their Abbey shares.

This equates to 559p a share, based on Friday's BSCH share price, which is a 13% premium to Abbey's Thursday price.

Abbey investors, who include about 2 million small shareholders, will be asked to vote on the proposed deal.

A merger between the two firms would create one of the world's top 10 banks by market value, analysts said.

Abbey shares closed down 23 pence, or 4%, at 557p.

BSCH shares were down 3% in afternoon trade, on fears that many Abbey shareholders would not want to hold on to BSCH shares.

The BSCH share price fall reduced the value of the proposed takeover to 543p a share, still ahead of the 493p at which Abbey closed on Thursday - the day before takeover talk was admitted.

As Abbey announced the takeover details, it also unveiled that it had made a pre-tax profit of £350m during the first half of the year compared with a £144m loss a year ago.

Analysts say a takeover should be good news for shareholders, who have had to put up with several years of poor results and seen Abbey fail in its foray into corporate banking.

Abbey National, Britain’s second biggest mortgage lenderhas agreed to be taken over by Spain's biggest bank, Banco Santander Central Hispano (BSCH), in a deal valued at about £8bn ($15bn).

The deal will catapult Spain's largest bank into the world's top 10 and give BSCH an 11 per cent slice of the UK banking market with access to Abbey's 741 branches.

Abbey National has more than 16 million customers and assets of £177bn as of end-2003

Abbey shareholders are being offered one share in the buyer, Banco Santander Central Hispano, plus 31 pence in cash for each of their Abbey shares.

This equates to 559p a share, based on Friday's BSCH share price, which is a 13% premium to Abbey's Thursday price.

Abbey investors, who include about 2 million small shareholders, will be asked to vote on the proposed deal.

A merger between the two firms would create one of the world's top 10 banks by market value, analysts said.

Abbey shares closed down 23 pence, or 4%, at 557p.

BSCH shares were down 3% in afternoon trade, on fears that many Abbey shareholders would not want to hold on to BSCH shares.

The BSCH share price fall reduced the value of the proposed takeover to 543p a share, still ahead of the 493p at which Abbey closed on Thursday - the day before takeover talk was admitted.

As Abbey announced the takeover details, it also unveiled that it had made a pre-tax profit of £350m during the first half of the year compared with a £144m loss a year ago.

Analysts say a takeover should be good news for shareholders, who have had to put up with several years of poor results and seen Abbey fail in its foray into corporate banking.


Features and Related Information
Abbey National Bank
Banco Santander Central Hispano

 

 


Functions
Contribute
Signup
Become an Editor
Articles
South Korean firm snaps up Lycos
Italian Prime Minister Nazi Insult
Japan considers levies on US goods
Samsung to invest $33 billion in new chips
IC9700 continues to rise
 
Other Articles
Insider View
Fairtrade foods boom in UK
Walmart changes its healthcare terms for employees
Disney power split
Google creators in share sell-off
Wembley Stadium fails to meet deadline
 
Links


Published by Associated News and Media | Internet Keyword: Allied Journal