Page 412 - The Case Lab Book

The Background

In early April Sir Fred suffered his first big
setback when he and his counterparts at
Fortis and Santander flew in to Amsterdam
for an arranged meeting to discuss their
intentions with Rijkman Groenink, ABN's
chief executive. However, unbeknown to
them, Groenink had flown to London for a
joint press conference with Barclays to Sir Fred Goodwin
announce a management –backed • Born 1958
agreement to be acquired by Barclays • CEO RBS 2000
without cancelling the meeting with the Sir Fred, a lawyer by training, an
RBS consortium. accountant by trade and a serial
acquirer by nature joined RBS in 1998
Sir Fred and his partners immediately went as deputy chief executive gaining the
on the offensive. With his team of 15 close top job in 2000. Since then he has
advisers Sir Fred sought any weaknesses undertaken 23 acquisitions (2000-2006)
in Barclays armour. and has now won the world’s largest
cross-border takeover battle for a Bank

However, the Barclays-ABN deal looked He has quadrupled the bank's assets
unbreakable. Not only had Barclays since 2000, while in 2006 pre-tax profits
unveiled a recommended all-share merger rose by 16 per cent to £9.2 billion. RBS
with ABN, but after the RBS Consortium now ranks among the world's top ten
announced its intention to bid for ABN it banks.
wrong-footed everybody by announcing in - ABN Amro. Sir Fred is notoriously
April a side-deal to sell ABN's Chicago- averse to any sort of personal publicity.
based US retail banking subsidiary, LaSalle
Bank Corp., to Bank of America for $21bn (£10.5). This was a particular blow to Sir
Fred, as LaSalle was widely regarded as his main target at ABN. It would be easy to
mesh LaSalle with RBS's flourishing US east coast business, Citizens.

ABN's decision to sell LaSalle was widely seen as a poison pill
measure to frustrate the RBS led consortium. The consortium
however, reacted by topping the Bank of America's offer for
LaSalle, with a separate £12 billion bid for the subsidiary - a move firmly rebuffed by
ABN.

ABN however, faced opposition in completing the LaSalle deal as the sale was
challenged by a Dutch shareholders' group, and was then blocked by Amsterdam’s
Superior Court because the ABN board had not received approval from its shareholders
for it.