UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
April 2007
Barclays PLC and
Barclays Bank PLC
(Names of Registrants)
1 Churchill Place
London E14 5HP
England
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No x
If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b):
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This Report is a joint Report on Form 6-K filed by Barclays PLC and Barclays
Bank PLC. All of the issued ordinary share capital of Barclays Bank PLC is
owned by Barclays PLC.
This Report comprises:
Information given to The London Stock Exchange and furnished pursuant to
General Instruction B to the General Instructions to Form 6-K.
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EXHIBIT INDEX
Agreement on Terms of Merger - 23 April 2007
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each of
the registrants has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BARCLAYS PLC
(Registrant)
Date: April 23, 2007 By: /s/ Patrick Gonsalves
----------------------
Patrick Gonsalves
Deputy Secretary
BARCLAYS BANK PLC
(Registrant)
Date: April 23, 2007 By: /s/ Patrick Gonsalves
----------------------
Patrick Gonsalves
Joint Secretary
This document shall not constitute an offer to sell or buy or the solicitation
of an offer to buy or sell any securities, nor shall there be any sale or
purchase of securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. The availability of the Offer to
persons not resident in the United States, the Netherlands and the United
Kingdom may be affected by the laws of the relevant jurisdictions. Such persons
should inform themselves about and observe any applicable requirements.
23 April 2007
For immediate release
ABN AMRO AND BARCLAYS ANNOUNCE AGREEMENT ON TERMS OF MERGER
The Managing Board and Supervisory Board of ABN AMRO Holding N.V. ("ABN AMRO")
and the Board of Directors of Barclays PLC ("Barclays") jointly announce that
agreement has been reached on the combination of ABN AMRO and Barclays. Each of
the Boards has unanimously resolved to recommend the transaction to its
respective shareholders. The holding company of the combined group will be
called Barclays PLC.
The proposed merger of ABN AMRO and Barclays will create a strong and
competitive combination for its clients with superior products and extensive
distribution. The merged group is expected to generate significant and sustained
future incremental earnings growth for shareholders.
The combination of ABN AMRO and Barclays will benefit from a diversified
customer base and geographic mix. The proposed merger will create:
- A leading force in global retail and commercial banking, with world class
products:
-47 million customers, approximately 90 per cent. of whom are in seven
key markets
-One of the world's leading transaction banking platforms offering
world class payment and trade finance solutions
-A top five card issuer outside the US with approximately 27m cards.
- A premier global investment bank that is a leader in risk management and
financing with an enhanced product offering across a broader geographical
footprint
- The world's largest institutional asset manager, with enhanced retail
distribution capabilities and complementary products ensuring delivery of
world class products and services to a wider customer base
- The world's eighth largest wealth manager, with a leading European onshore
franchise and highly attractive positions in growth markets
Merger Highlights
- The proposed merger will be implemented through an exchange offer pursuant
to which ABN AMRO ordinary shareholders will receive 3.225 ordinary shares
in Barclays ("New Barclays Shares") for each existing ABN AMRO ordinary
share (the "Offer"). Under the terms of the Offer, Barclays existing
ordinary shareholders will own approximately 52 per cent. and ABN AMRO
existing ordinary shareholders will own approximately 48 per cent. of the
combined group
- Based on the share price of Barclays ordinary shares on 20 April 2007, the
Offer values each ABN AMRO ordinary share at EUR36.25 taking into account
that ABN AMRO ordinary shareholders will be entitled to receive the
declared EUR0.60 2006 final dividend. In addition, depending on the
timetable to completion, ABN AMRO ordinary shareholders will also benefit
from Barclays 2007 final dividend, which has a greater final dividend to
total dividend weighting than ABN AMRO. The implied value of the Offer
represents a premium for ABN AMRO shareholders of approximately:
33 per cent. to the share price of ABN AMRO ordinary shares on 16
March 2007, the last trading day prior to the announcement that ABN
AMRO and Barclays were in talks
49 per cent. over the average share price of ABN AMRO ordinary shares
in the 6 months up to and including to 16 March 2007
- The combined group will have a UK corporate governance structure with a
unitary Board. Arthur Martinez will be the Chairman, John Varley will be
the Chief Executive Officer, and Bob Diamond will be President. The new
board will initially consist of 10 members from Barclays and 9 members from
ABN AMRO
- Barclays will be the holding company for the combined group. The UK
Financial Services Authority ("FSA") and De Nederlandsche Bank ("DNB") have
agreed that the FSA will be the lead supervisor of the combined group
- The head office of the combined group will be located in Amsterdam
- ABN AMRO and Barclays estimate that the combination will result in annual
pre-tax synergies of approximately EUR3.5bn by 2010, approximately 80 per
cent. of which is expected to result from cost synergies and the remainder
from revenue benefits. Capturing the expected synergies will assist the
management of the combined group in achieving top quartile cost: income
ratios across all businesses by 2010
- Bank of America Corp has today agreed to acquire LaSalle Bank Corporation
("LaSalle") for US$21 billion and is expected to complete this acquisition
before completion of the Offer. The completion of the sale of LaSalle is a
condition of the Offer. Taking into account the excess capital released by
the sale of LaSalle, it is expected that approximately EUR12 billion will
be distributed to the shareholders of the combined group in a tax efficient
form primarily through buy backs after completion of the Offer. The full
value of the sale of LaSalle on these terms is reflected in the exchange
ratio of the proposed merger. The combined group will continue to be a
leading franchise in investment banking and investment management in the
US. The combined group will continue to explore opportunities to develop
its existing US businesses
- It is expected that the proposed merger will lead to significant accretion
in ABN AMRO's 2008 cash earnings per share for accepting ABN AMRO ordinary
shareholders and is expected to be 5 per cent. accretive to Barclays cash
earnings per share in 2010. The Board of Barclays expects that the return
on investment will be approximately 13 per cent. in 2010.
- The proposed merger is expected to complete during the fourth quarter of
2007
Current Trading
On 16 April 2007, ABN AMRO issued a trading statement announcing a strong
improvement in the operating result, leading to a 30 per cent. increase in
earnings per share from continuing operations compared to the first quarter of
2006.
Barclays profit before tax for the first quarter of 2007 was 15 per cent. ahead
of the first quarter of 2006. Excluding gains from the sale and leaseback of
property, profit before tax grew 10 per cent. Performance was particularly
strong at Barclays Capital which had its best quarter ever. Barclays expects to
announce its customary trading update on 24 May 2007.
Rijkman Groenink, the Chairman of the Managing Board of ABN AMRO, said:
"This proposed merger fits well with our strategic objective to provide
significant and sustained value for our shareholders. We believe that merging
with Barclays will unite our significant complementary strengths and create
long-term value for our shareholders. I am excited about the opportunities this
merger brings and look forward to the next phase of ABN AMRO's future."
John Varley, the CEO of Barclays, said:
"This proposed merger represents a unique opportunity to create a new
competitive force in financial services, which will deliver benefits for our
customers and clients and generate sustained growth and additional value for our
owners. The proposed merger will significantly enhance stand-alone product
development capabilities and distribution. Our combined geographic reach will
ensure exposure to both developed and high growth developing economies."
The Managing Board and Supervisory Board of ABN AMRO consider that the Offer is
in the best interests of ABN AMRO and all of its shareholders and have each
unanimously resolved to recommend the Offer for acceptance by the shareholders
of ABN AMRO.
ABN AMRO Bank N.V. (Corporate Finance), Lehman Brothers Europe Limited, Morgan
Stanley & Co. Limited, N M Rothschild & Sons Limited and UBS Limited are acting
as financial advisers to the Managing Board of ABN AMRO. Morgan Stanley & Co
Limited and UBS Limited have each provided a fairness opinion to the Managing
Board of ABN AMRO. Goldman Sachs International has provided a fairness opinion
to the Supervisory Board of ABN AMRO.
The Board of Barclays, which has received financial advice from Barclays
Capital, Citi, Credit Suisse, Deutsche Bank, JPMorgan Cazenove and Lazard
(collectively, the "Barclays Advisers") considers that the terms of the Offer
are fair and reasonable. In providing their advice to the Board, the Barclays
Advisers have relied upon the Board's commercial assessment of the Offer.
The Board of Barclays also considers the resolutions to be proposed in
connection with the Offer to be in the best interests of Barclays and Barclays
shareholders as a whole. Accordingly, the Board has resolved unanimously to
recommend that Barclays shareholders vote in favour of such resolutions.
1. Compelling Strategic Rationale
The proposed combination of ABN AMRO and Barclays will create one of the world's
leading universal banks. Both ABN AMRO and Barclays operate in a sector which is
still fragmented in comparison to other global industries. Universal banking is
the model best equipped for success in an industry where customer needs are
converging and where demand-led growth will be significant across the globe.
Harmonisation of customer needs is already well advanced in investment banking
and investment management and is increasingly apparent in retail and commercial
banking.
The proposed merger brings together two sets of high quality product
capabilities and brands, which are well placed to create growth for shareholders
from the relationship extension opportunities that exist in a combined base of
46 million personal and 1.4 million commercial customers.
The combined group will have a simple and transparent management structure. The
management team will be clearly accountable for delivering sustained incremental
earnings growth and value for shareholders by leading strong performance from
the underlying businesses and by capturing the substantial synergies made
available by the merger.
There will be two principal business groupings within the combined group, Global
Retail and Commercial Banking ("GRCB") and Investment Banking and Investment
Management ("IBIM"). GRCB will be led by Frits Seegers, currently CEO of GRCB in
Barclays. IBIM will be led by Bob Diamond, Barclays Group President.
GLOBAL RETAIL AND COMMERCIAL BANKING
ABN AMRO and Barclays bring together two sets of highly complementary
geographies. Approximately 90 per cent. of the combined group's branches will be
in seven countries. In Europe the combination will have leading franchises in
the UK and the Netherlands and attractive positions in the Italian, Spanish and
Portuguese markets. Additionally, the combination will have significant exposure
to the high growth developing economies of Brazil and South Africa offering
substantial revenue and profit growth opportunities. The combined group will
also leverage on ABN AMRO's fast growing Asian business.
Customers will benefit from the enhanced product capabilities of the combined
group drawing on, for example, ABN AMRO's global cash and payments
infrastructure and Barclays expertise in credit cards.
ABN AMRO and Barclays are both recognised leaders in commercial banking. They
both have substantial market positions in the mid-market segment. The merger
will accelerate Barclays ambition to develop its business banking activities
globally. The franchise will be further strengthened by the linkage between a
strong investment banking product range and the track record of both ABN AMRO
and Barclays in selling investment banking products to mid-market clients across
the combined group's broad geographic footprint.
There is significant opportunity for increased cost efficiency through the
optimisation of the operating infrastructure and processes.
INVESTMENT BANKING
The combination of ABN AMRO and Barclays will support the ambition to be the
premier global investment bank in risk management and financing through enhanced
product expertise and broader geographic exposure. Barclays existing product
capabilities will be considerably enhanced, particularly in commodities, FX,
equities, M&A, corporate broking, structured credit and private equity and its
geographic and client reach will also be extended significantly into Asia, Latin
America and Continental Europe. The combined investment bank will operate on the
Barclays Capital scaleable platform and will target an alignment to a top
quartile cost:income ratio by 2010.
WEALTH MANAGEMENT
The combination of ABN AMRO and Barclays will create the world's eighth largest
wealth manager, with a leading European onshore franchise with leading positions
in the Netherlands and UK, a strong European franchise across Germany, Belgium,
France and Spain and attractive growing positions in Asia and Brazil. The
product development capabilities of the combined asset management business
together with an extensive distribution network will allow the merged business
to benefit from favourable demographic trends and increasing demand-led client
volumes.
ASSET MANAGEMENT
The combined group will be the world's largest institutional asset manager.
Barclays Global Investors' world leading index-based, exchange traded fund and
quantitative active capabilities will be complemented by ABN AMRO's active
fundamental based capabilities. There are expanded opportunities for retail
distribution of the current product set including BGI's rapidly growing iShares
exchange traded funds.
2. Significant Cost Synergies and Revenue Benefits
Potential synergies arising from the combination have been assessed by a joint
team from ABN AMRO and Barclays through a detailed bottom up approach involving
business leaders from both banks. Capturing the expected synergies will assist
the management of the combined group in achieving top quartile cost:income
ratios across all businesses by 2010.
Below is a summary of the estimated pre-tax annual cost synergies and revenue
benefits that are expected to be realised in the three calendar years commencing
2008.
EURm pre tax annual 2008e 2009e 2010e
Cost 870 2,080 2,800
Revenue (470) - 700
Total 400 2,080 3,500
The estimated 2010 annual pre-tax cost synergies are equivalent to approximately
9 per cent. of 2006 combined group costs excluding LaSalle and revenue benefits
are equivalent to approximately 1 per cent. of combined group revenues excluding
LaSalle. Of the estimated cost synergies of EUR2,800m, approximately 57 per
cent. relate to headcount rationalisation; 29 per cent. are derived from a
reduction in IT and telecoms hardware, software and development spend; and the
remaining 14per cent. is derived from a number of sources including property and
discretionary spend.
GLOBAL RETAIL AND COMMERCIAL BANKING
It is estimated that the pre-tax annual cost synergies in retail and commercial
banking will be EUR1,650m in 2010, representing approximately 10 per cent. of
the combined retail and commercial cost base excluding LaSalle. The cost
synergies are expected to result from the consolidation of the retail and
commercial banking activities into a universal banking model including:
- best practice off-shoring, improved procurement and real estate
rationalisation
- the consolidation of data centres and supporting IT networks
- the use of ABN AMRO's trade and payments back office operations in the
Barclays network and integration of card operations under Barclaycard
- the reduction of overlaps in management structures and the retail and
commercial operations in the eight overlapping countries.
Revenue benefits are estimated to amount to at least EUR150m pre-tax in 2010,
which is equivalent to 0.5 per cent. of combined revenues. These are expected to
be primarily derived from extending ABN AMRO's broader cash management product
offering, increasing ABN AMRO's revenue per credit card towards Barclays
comparable levels and realising the network benefits of the increased global
market presence.
INVESTMENT BANKING
The estimated annual pre-tax cost synergies in investment banking in 2010 are
expected to amount to approximately EUR850m. Pre tax cost synergies are
equivalent to 8 per cent. of combined costs. The cost synergies are expected to
be derived from the integration of the two banks operations onto one operating
platform and subsequent reduction of back office staff and non-staff cost.
It is estimated that revenue benefits, net of assumed revenue attrition, in
investment banking in 2010 will be EUR500m pre-tax, equivalent to 3 per cent. of
combined revenues. These benefits are expected to be derived from offering a
stronger and broader product set to the combined client base and building on the
productivity gains within ABN AMRO's investment banking operations. It is
expected that, in addition to the revenue benefits, the combined business will
continue to be able to deliver attractive organic growth consistent with
Barclays Capital's existing prospects.
OTHER SYNERGIES
It is estimated that further cost synergies of EUR200m will arise from the
rationalisation of the two head offices and approximately EUR100m will arise
from the reduction of overlap in wealth and asset management.
Further revenue benefits of approximately EUR50m are estimated to arise
primarily in the wealth and asset management businesses as a result of the
enhanced distribution capabilities of the combined group.
INTEGRATION COSTS
The total pre-tax integration cost of realising the synergy benefits is
estimated to be EUR3,600m of which approximately EUR2,160m is expected to be
incurred in 2008, approximately EUR1,080m is expected to be incurred in 2009 and
approximately EUR360m is expected to be incurred in 2010. Employee rights will
be safeguarded under applicable law and any redundancies will be subject to the
applicable process of employee consultation.
OVERVIEW OF HEADCOUNT RATIONALISATION
ABN AMRO and Barclays have identified the possibility of rationalising the
number of staff of the combined group through a combination of natural
attrition, offshoring and outsourcing as well as redundancies. The
rationalisation of headcount is expected to be implemented over 3 years
following completion of the Offer.
The reduction in staff is a necessary part of the envisaged synergies from the
combination of the two banks. Part of the expected staff reduction will be
through establishing shared services and offshoring those positions to low cost
locations, such as India where new staff will be recruited at ABN AMRO's
existing ACES operations.
It is expected that the combination of Barclays and ABN AMRO will result in a
net reduction in staff of approximately 12,800. In addition, it is expected that
approximately 10,800 full-time equivalent positions will be offshored to
low-cost locations. This will impact a gross total of approximately 23,600
full-time equivalent positions of the combined work force of approximately
217,000. (Barclays has c.123,000 employees, ABN AMRO c.94,000 excluding LaSalle)
ABN AMRO and Barclays are aware of the fact that these measures can have
difficult consequences for a number of staff. When it comes to matters affecting
our staff, both ABN AMRO and Barclays have a good reputation and are committed
to that reputation. ABN AMRO and Barclays will inform and consult with the
appropriate employee representative bodies in the relevant countries and will
seek all necessary regulatory consents before taking decisions in relation to
these anticipated effects of the merger. ABN AMRO and Barclays will honour all
agreements with their respective unions.
3. Board Composition
The combined group will have a UK corporate governance structure with a unitary
Board. Arthur Martinez will be the Chairman, John Varley will be the CEO and Bob
Diamond will be the President. Marcus Agius will become Deputy Chairman of the
combined group and will remain Chairman of Barclays Bank plc. It is intended
that he will succeed Arthur Martinez as Chairman of the combined group when
Arthur Martinez retires. In addition to the Chairman and Deputy Chairman, there
will be 12 non-executive directors, with 5 initially nominated by Barclays and 7
initially nominated by ABN AMRO. Rijkman Groenink, the current Chairman of the
Managing Board of ABN AMRO will be one of the non-executive directors appointed
by ABN AMRO. In addition to the CEO and President, the new Board will include
Frits Seegers, Huibert Boumeester, and Chris Lucas as executive directors.
4. Management and Operating Model
The head office of the combined group will be located in Amsterdam. Management
of the combined group will be the responsibility of a Group Executive Committee,
which will be chaired by the Group CEO and will consist of:
- John Varley, Group Chief Executive
- Bob Diamond, Group President and CEO of IBIM
- Frits Seegers, CEO of GRCB
- Piero Overmars, CEO of Continental Europe and Asia, GRCB
- Ron Teerlink, Chief Operating Officer of GRCB
- Paul Idzik, Group Chief Operating Officer
- Chris Lucas, Group Finance Director
- Huibert Boumeester, Group Chief Administrative Officer
Wilco Jiskoot will become a Vice Chairman of Barclays Capital with senior
responsibility for client relationships.
Investment Banking and Investment Management will be headquartered in London and
will comprise:
- Barclays Capital which will incorporate Barclays Capital and ABN AMRO
Global Markets and Global Clients and ABN AMRO Private Equity businesses
- Barclays Global Investors and ABN AMRO Asset Management
- Wealth Management which will incorporate Barclays Wealth and ABN AMRO
Private Clients
Global Retail and Commercial Banking will be headquartered in Amsterdam and will
incorporate the retail & commercial banking operations of the combined group,
including:
- Barclays UK Retail Banking and UK Business Banking, International Retail
and Commercial Banking and Barclaycard Operations
- ABN AMRO's Transaction Banking, BU Netherlands, BU Europe (ex Global
Markets), Antonveneta, BU Latin America and BU Asia
5. Regulation and Tax
The FSA and DNB have agreed that the FSA will be lead supervisor of the combined
group and that the DNB and FSA will be the consolidated supervisors of the ABN
AMRO and Barclays groups respectively. The FSA and DNB will agree the detail of
how the close working relationship between them will work to achieve effective
supervision of the combined group.
Barclays, which will be the holding company for the combined group, will remain
UK incorporated, and is expected to remain UK tax resident.
6. Capital Management and Dividend Policy
ABN AMRO Bank N.V. and Barclays Bank PLC will seek to maintain their strong
credit ratings. The combined group will take a disciplined approach to capital
optimisation and will target an Equity Tier 1 ratio of 5.75 per cent. and a Tier
1 ratio of 7.75 per cent., which broadly approximate to the current pro forma
ratios for the combined group. It has been assumed, for the purpose of
estimating financial effects, that excess equity over and above the target
Equity Tier 1 ratio after accounting for dividends and organic growth in risk
weighted assets would be returned to shareholders by way of share buybacks.
It is expected that the combined group will maintain Barclays and ABN AMRO's
progressive dividend policy and that dividends per share will grow approximately
in line with earnings per share over the longer term. With the combined group's
annual dividend approximately twice covered by cash earnings, the management of
the combined group believe that balance between income distribution to
shareholders and earnings retention to fund growth is appropriate. It is also
expected that the combined group will continue Barclays practice of weighting
the annual dividend towards the final dividend to maintain flexibility. It is
not expected that the dividends per share in 2008 will be materially different
to the dividend Barclays would have expected to distribute to shareholders had
the merger not occurred. The combined group will present financial statements in
Euro and shareholders will be able to receive dividends in either Sterling or
Euro.
7. Terms of the Offer
The Offer values each ABN AMRO ordinary share at EUR36.25 based on the share
price of Barclays ordinary shares on 20 April 2007 taking into account that ABN
AMRO ordinary shareholders will be entitled to receive the declared EUR0.60 2006
final dividend. In addition, depending on the timetable to completion, ABN AMRO
ordinary shareholders will also benefit from Barclays 2007 final dividend, which
has a greater final dividend to total dividend weighting than ABN AMRO.
Subject to the satisfaction or waiver of certain pre-Offer conditions, Barclays
will make the Offer to ABN AMRO ordinary shareholders pursuant to which they
will receive:
3.225 New Barclays Shares for every 1 ABN AMRO ordinary share
0.80625 New Barclays ADSs for every 1 ABN AMRO ADS
The total consideration equates to EUR67 billion and the implied value per ABN
AMRO ordinary share represents a price to 2006 reported earnings multiple of
14.2 times and a price to 2006 book multiple of 2.8 times. The Offer represents
a premium for ABN AMRO ordinary shareholders of approximately:
33 per cent. to the share price of ABN AMRO ordinary shares on 16 March 2007,
the last trading day prior to the announcement that ABN AMRO and Barclays were
in talks
49 per cent. over the average share price of ABN AMRO ordinary shares in the 6
months up to and including to 16 March 2007
Under the terms of the Offer, existing ABN AMRO ordinary shareholders will own
approximately 48 per cent. of the issued ordinary share capital of the combined
group and existing Barclays ordinary shareholders would own approximately 52 per
cent. of the issued ordinary share capital of the combined group, assuming all
of the ABN AMRO ordinary shares and ADSs currently in issue are tendered under
the Offer.
It is expected the proposed merger will lead to significant accretion in ABN
AMRO's cash earnings per share for accepting ABN AMRO ordinary shareholders on
completion of the Offer. For accepting ABN AMRO ordinary shareholders, dividend
income from their ownership of New Barclays Shares would have been 28 per cent.
higher than the dividend income from their ABN AMRO ordinary shares on the basis
of ABN AMRO and Barclays 2006 dividends. It is expected that the proposed merger
will be 5 per cent. accretive to Barclays cash earnings per share in 2010. The
directors of Barclays expect that the return on investment will be approximately
13 per cent. in 2010.
Barclays intends to put forward a proposal for all the depository receipts which
represent the ABN AMRO convertible financing preference shares consistent with
the terms of the prospectus dated 31 August 2004 relating to the ABN AMRO
convertible financing preference shares. A cash offer will be made for the
issued and outstanding formerly convertible preference shares of EUR27.65, the
closing price on 20 April 2007. The aggregate consideration payable for the
formerly convertible preference shares will be in the region of EUR1.2 million.
The members of ABN AMRO's Managing Board and Supervisory Board have each agreed
to undertake to tender all ABN AMRO ordinary shares held by them under the
Offer, such undertakings being revocable jointly with their recommendations.
It is intended that holders of options and awards under ABN AMRO share schemes
will be offered the ability to exercise their options or awards or, where
practicable, the opportunity to roll their awards over into shares of the
combined group subject to certain terms.
8. The New Barclays Shares
Application will be made to the UKLA and the London Stock Exchange ("LSE") for
the New Barclays Shares to be admitted to the Official List and to trading on
the LSE. Barclays will also apply for a secondary listing on Euronext Amsterdam
N.V.'s Eurolist by Euronext.
ABN AMRO and Barclays have received confirmation from the FTSE and Euronext
that, following the Offer, the ordinary shares of the combined group are
expected to qualify for inclusion with a full weighting in the UK Series of the
FTSE indices including the FTSE 100 Index and in the AEX-Index (subject to the
15 per cent. maximum weighting).
It is expected that listing on the LSE will become effective and dealings, for
normal settlement, will begin shortly following the date on which Barclays
announces that all conditions to the Offer have been satisfied or waived.
Listing on Euronext Amsterdam will become effective and dealings, for settlement
through Euroclear Netherlands, will begin on or around the same date.
It is expected that applications will be made to list the New Barclays Shares
and the new Barclays ADSs which represent such New Barclays Shares, on the New
York Stock Exchange and also to list the New Barclays Shares on the Tokyo Stock
Exchange. Further details on settlement, listing and dealing will be included in
the Offer documentation.
The New Barclays Shares will be issued credited as fully paid and will rank pari
passu in all respects with existing Barclays ordinary shares and will be
entitled to all dividends and other distributions declared or paid by Barclays
by reference to a record date on or after completion of the Offer but not
otherwise. Barclays pays dividends semi-annually. It is expected that the record
date for the interim dividend declared by Barclays in respect of 2007 will be
before completion of the Offer. ABN AMRO shareholders are expected to be
entitled to receive and retain the ABN AMRO interim dividend in respect of 2007
(expected to be paid on 27 August 2007).
Further details of the rights attaching to the New Barclays Shares and a
description of any material differences between the rights attaching to those
shares and the ABN AMRO ordinary shares will be set out in the Offer
documentation.
9. Sale of LaSalle
Separate to this announcement, ABN AMRO today also announced the sale of LaSalle
to Bank of America for US$21 billion in cash. ABN AMRO will retain its North
American capital markets activities within its Global Markets unit and Global
Clients divisions as well as its US Asset Management business. The sale of
LaSalle is expected to be completed in Q4 2007 and is subject to regulatory
approvals and other customary closing conditions. The agreement with Bank of
America permits ABN AMRO to execute a similar agreement for a higher offer for
the business for a period of 14 calendar days from 22 April 2007, permits Bank
of America to match any higher offer and provides for a termination fee of
US$200 million payable to Bank of America if the agreement is terminated under
certain limited circumstances. The purchase price is subject to certain
adjustments linked to the financial performance of LaSalle before the closing of
the sale to Bank of America.
The consummation of the sale of LaSalle is an offer condition to the proposed
merger. Taking into account the excess capital released by the sale of LaSalle,
it is estimated that approximately EUR12 billion will be distributed to the
shareholders of the combined group in a tax efficient form, primarily through
buy backs, after completion of the merger.
As at 31 December 2006, LaSalle had more than US$113 billion in tangible assets
and a tangible book value of US$9.7 billion, adjusted for businesses retained
and the previously announced sale of the mortgage operations unit and presented
on a US GAAP basis. For the year ended 31 December 2006, LaSalle, presented on
the same basis, had net income of US$1,035 million. On the basis of the above,
the purchase price of US$21 billion represents a 2006 price to earnings multiple
of 20.3 and a 2006 price to tangible book value multiple of 2.2.
10. The Merger Protocol
The expectation that ABN AMRO and Barclays would reach an agreement on the
intended Offer was realised after meetings of the Barclays Board in London and
the ABN AMRO Managing Board and Supervisory Board in Amsterdam. Following those
meetings, ABN AMRO and Barclays entered into a merger protocol (the "Merger
Protocol").
The commencement of the Offer is subject to the satisfaction or waiver of
certain pre-Offer conditions customary for transactions of this type and certain
other pre-Offer conditions including those summarised in Appendix III. When
made, the Offer will be subject to the satisfaction or waiver of certain Offer
conditions customary for transactions of this type and certain other Offer
conditions including those summarised in Appendix III.
The terms of the Merger Protocol restrict ABN AMRO from initiating or
encouraging discussions or providing confidential information in relation to any
proposal which may form an alternative to the Offer. However, ABN AMRO's Boards
may withdraw their recommendations of the Offer if their Boards, acting in good
faith and observing their fiduciary duties to best serve the interests of ABN
AMRO and all its stakeholders, determine an alternative offer to be more
beneficial than the Offer. ABN AMRO's Boards will not recommend a competing
offer unless Barclays has first had the opportunity to make a revised proposal
for ABN AMRO.
If the Merger Protocol is terminated as a result of material breach or
withdrawal of recommendation then the other party must pay a break fee of
EUR200m. Until such termination no other break fees can be agreed with third
parties.
The exchange ratio of the Offer will be adjusted to reflect certain capital
raisings or capital returns by either party prior to completion of the Offer.
Any reduction in the price paid for LaSalle below $21 billion will be treated as
a capital return by ABN AMRO and the exchange ratio will be adjusted
accordingly.
11. Process and Indicative Timetable
ABN AMRO and Barclays will seek to obtain all necessary regulatory and
competition approvals and clearances and will complete all requisite employee
consultation and information processes as soon as reasonably possible with a
view to receiving the required regulatory, competition and other consents or
approvals for the Offer.
As soon as reasonably practicable after the pre-Offer conditions have been
satisfied or waived, the transaction documentation will be posted to
shareholders, including Offer documentation to ABN AMRO shareholders and a
circular to Barclays shareholders seeking approval for the transaction.
If the Offer is declared unconditional, it is intended that ABN AMRO's listings
of ordinary shares and formerly convertible preference shares on Eurolist by
Euronext Amsterdam N.V. will be terminated as soon as possible. Furthermore,
subject to the necessary thresholds being reached, Barclays expects to initiate
the squeeze out procedures permitted by law in order to acquire all ABN AMRO
shares held by minority shareholders or take such other steps to terminate the
listing and/or acquire shares not otherwise acquired by it, including effecting
a legal merger if appropriate.
Indicative timetable
July 2007 Publication of Offer documentation, Prospectus and Barclays
circular to shareholders
August 2007 Extraordinary General Meeting of Barclays shareholders to
approve the Offer
August 2007 Extraordinary General Meeting of ABN AMRO shareholders to
consider the Offer
Fourth Quarter 2007 Settlement of the Offer
The indicative time table is included for illustrative purposes only and may be
subject to change. The timeframe between this announcement and the publication
of the Offer documentation is primarily driven by anticipated regulatory
requirements.
12. Advisors
Barclays Capital, Citigroup Global Markets Limited, Credit Suisse Securities
(Europe) Limited, Deutsche Bank AG, London Branch, JPMorgan Cazenove Limited and
Lazard & Co., Limited are acting as financial advisers for Barclays. Clifford
Chance LLP and Sullivan and Cromwell LLP are acting as legal advisers to
Barclays.
ABN AMRO Bank N.V. (Corporate Finance), Lehman Brothers Europe Limited, Morgan
Stanley & Co. Limited, N M Rothschild & Sons Limited and UBS Limited are acting
as financial advisers for ABN AMRO. Goldman Sachs International is acting as
exclusive financial adviser to the Supervisory Board of ABN AMRO. Nauta Dutilh
N.V., Allen & Overy LLP and Davis Polk & Wardwell are acting as legal advisers
to ABN AMRO.
Investor, Analyst and Press Information
BARCLAYS AND ABN AMRO PRESENTATION TO ANALYSTS AND INVESTORS
Barclays and ABN AMRO today announced their agreement on a merger.
A meeting for analysts and institutional investors will be hosted by John
Varley, Barclays Group Chief Executive, Rijkman Groenink, Chairman of the
Managing Board of ABN AMRO and Chris Lucas, Barclays Group Finance Director. The
details of the meeting are as follows:
- Venue: 1 Churchill Place, Canary Wharf, London E14 5HP. The nearest station is
Canary Wharf, Docklands Light Railway and Jubilee Line
- Date & Time: 23 April 2.00pm - 3.30pm (BST) (3.00pm - 4.30pm (CET)) for a
prompt start. Registration will commence at 1.30pm (BST) and coffee will be
served.
Please note as seating is limited, it may be necessary to restrict the number of
attendees from each institution.
- Slide presentation packs will be available at
www.investorrelations.barclays.com and at www.investor.abnamro.com shortly.
If you are unable to attend the meeting in person, you can listen through any of
the following options:
- a live webcast of the event is available at www.investorrelations.barclays.com
and at www.investor.abnamro.com
- a live conference call by dialling 0845 359 0170 (UK), 0800 022 9132 (NL)
or +44 (0)20 3003 2648 (all other locations) and quoting 'Barclays Update'.
The webcast and live conference call provide an opportunity to listen remotely
(listen only mode) to the live presentation and join in the Q&A session. A
replay of the conference call will be available by dialing 020 8196 1998 (UK),
0207 084 179 (NDL) and +44 (0) 20 8196 1998 (all other locations) and entering
the access code: 815886#.
BARCLAYS AND ABN AMRO PRESS CONFERENCES
Barclays and ABN AMRO today will hold press conferences for members of the media
in Amsterdam and London.
The press conferences which will be hosted by Rijkman Groenink, Chairman of the
Managing Board of ABN AMRO and John Varley, Barclays Group Chief Executive. The
details of the press conferences are as follows:
Amsterdam press conference:
- Venue: Gustav Mahlerlaan 10, 1000 EA Amsterdam. The nearest railway and metro
station is Amsterdam Zuid-WTC.
- Time: 0900 (CET) (0800 BST)
London press conference:
- Venue: 1 Churchill Place, Canary Wharf, London E14 5HP. The nearest station is
Canary Wharf, Docklands Light Railway and Jubilee Line
- Time: 1215 BST (1315 CET).
The press conferences can also be accessed through any of the following options:
- a live webcast of the event is available at www.abnamro.com (Amsterdam Press
Conference) and www.newsroom.barclays.com (UK press conference)
- a live conference call by dialling 0845 301 4070 (UK), 0800 024 9997 (NL) or
+44 (0)20 3003 2648 (all other locations) and quoting Barclays and ABN AMRO
Press Conference Amsterdam or Barclays and ABN AMRO Press Conference London as
appropriate.
There will be a separate conference call for Newswires:
- Time: 0800 (CET) (0700 BST)
The dial in details are as follows and those participating will need to ask for
the Barclays and ABN AMRO Newswires call
From the UK: 0845 359 0170
From the Netherlands: 0800 022 9132
From all other countries: +44 20 3003 2648
The conference calls will be recorded and available for 4 weeks. Replay access
details are shown below:
From the UK: 020 8196 1998
From the Netherlands: 0207 084 179
From all other countries: +44 20 8196 1998
Newswires conference call replay PIN number: 509497#
Netherlands Press Conference replay PIN number: 101629#
UK Press Conference replay PIN number: 515286#
A video interview with John Varley, Group Chief Executive of Barclays, can be
viewed on Barclays website www.barclays.com where it is also available in audio
and transcript.
Enquiries:
ABN AMRO
ANALYSTS AND INVESTORS
Richard Bruens +31 20 6287835
Alex van Leeuwen +31 20 6287835
Dies Donker +31 20 6287835
Alexander Mollerus +31 20 6287835
MEDIA
Jochem van de Laarschot +31 20 6288900
Neil Moorhouse +31 20 6288900
Piers Townsend +44 207 678 8244
Barclays
ANALYSTS AND INVESTORS
Mark Merson +44 20 7116 5752
James S Johnson +44 20 7116 2927
MEDIA
Stephen Whitehead +44 20 7116 6060
Alistair Smith +44 20 7116 6132
This announcement is a public announcement as defined in section 9b paragraph 2
subsection a and d of the Dutch Securities Markets Supervision Decree (Besluit
toezicht effectenverkeer 1995).
About ABN AMRO
ABN AMRO is a prominent international bank with a clear focus on consumer and
commercial clients in our local markets and focus globally on select
multinational corporations and financial institutions, as well as private
clients. ABN AMRO ranks eighth in Europe and 13th in the world based on total
assets, with more than 4,500 branches in 53 countries, a staff of more than
105,000 full-time equivalents and total assets of EUR 987 billion (as at 31
December 2006). Pro forma 2006 attributable profits excluding LaSalle were
EUR3,636m. Pro forma total assets excluding LaSalle were EUR901bn (as at 31
December 2006). Further information about ABN AMRO can be found on our website
www.abnamro.com
About Barclays
Barclays is a major global financial services provider engaged in retail and
commercial banking, credit cards, investment banking, wealth management and
investment management services with an extensive international presence in
Europe, the USA, Africa and Asia. It is one of the largest financial services
companies in the world by market capitalisation. With over 300 years of history
and expertise in banking, Barclays operates in over 50 countries and employs
123,000 people. Barclays moves, lends, invests and protects money for over 27
million customers and clients worldwide. For further information about Barclays,
please visit our website www.barclays.com.
Other information
Future SEC Filings and this Filing: Important Information
In connection with the proposed business combination transaction between ABN
AMRO and Barclays, Barclays expects it will file with the SEC a Registration
Statement on Form F-4, which will constitute a prospectus, as well as a Tender
Offer Statement on Schedule TO and other relevant materials. In addition, ABN
AMRO expects that it will file with the SEC a Solicitation/Recommendation
Statement on Schedule 14D-9 and other relevant materials. Such documents,
however, are not currently available.
INVESTORS ARE URGED TO READ ANY DOCUMENTS REGARDING THE POTENTIAL TRANSACTION IF
AND WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Investors will be able to obtain a free copy of such filings without charge, at
the SEC's website (http://www.sec.gov) once such documents are filed with the
SEC. Copies of such documents may also be obtained from ABN AMRO and Barclays
without charge, once they are filed with the SEC.
This document shall not constitute an offer to buy or sell or the solicitation
of an offer to buy or sell any securities in such a proposed transaction, nor
shall there be any sale of such securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction. No offering of
securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.
Forward Looking Statements
This document contains certain forward-looking statements within the meaning of
Section 21E of the US Securities Exchange Act of 1934, as amended, and Section
27A of the US Securities Act of 1933, as amended, with respect to certain of ABN
AMRO's and Barclays plans and their current goals and expectations relating to
their future financial condition and performance and which involve a number of
risks and uncertainties. ABN AMRO and Barclays caution readers that no
forward-looking statement is a guarantee of future performance and that actual
results could differ materially from those contained in the forward-looking
statements. These forward-looking statements can be identified by the fact that
they do not relate only to historical or current facts. Forward-looking
statements sometimes use words such as 'aim', 'anticipate', 'target', 'expect',
'estimate', 'intend', 'plan', 'goal', 'believe', or other words of similar
meaning. Examples of forward-looking statements include, among others,
statements regarding the consummation of the business combination between ABN
AMRO and Barclays within the expected timeframe and on the expected terms (if at
all), the benefits of the business combination transaction involving ABN AMRO
and Barclays, including the achievement of synergy targets, ABN AMRO's and
Barclays future financial position, income growth, impairment charges, business
strategy, projected costs and estimates of capital expenditure and revenue
benefits, projected levels of growth in the banking and financial markets, the
combined group's future financial and operating results, future financial
position, projected costs and estimates of capital expenditures, and plans and
objectives for future operations of ABN AMRO, Barclays and the combined group
and other statements that are not historical fact. Additional risks and factors
are identified in ABN AMRO and Barclays filings with the SEC including ABN AMRO
and Barclays Annual Reports on Form 20-F for the fiscal year ending December 31,
2006, which are available on ABN AMRO's website at www.abnamro.com and Barclays
website at www.barclays.com respectively, and on the SEC's website at
www.sec.gov.
Any forward-looking statements made by or on behalf of ABN AMRO and Barclays
speak only as of the date they are made. ABN AMRO and Barclays do not undertake
to update forward-looking statements to reflect any changes in expectations with
regard thereto or any changes in events, conditions or circumstances on which
any such statement is based. The reader should, however, consult any additional
disclosures that ABN AMRO and Barclays have made or may make in documents they
have filed or may file with the SEC.
Nothing in this announcement is intended, or is to be construed, as a profit
forecast or to be interpreted to mean that earnings per ABN AMRO or Barclays
share for the current or future financial years, or those of the combined group,
will necessarily match or exceed the historical published earnings per ABN AMRO
or Barclays share.
This document shall not constitute an offer to buy or sell or the solicitation
of an offer to buy or sell any securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws of
any such jurisdiction.
The availability of the Offer to persons not resident in the United States, the
Netherlands and the United Kingdom may be affected by the laws of the relevant
jurisdictions (the "Restricted Jurisdictions"). Such persons should inform
themselves about and observe any applicable requirements.
The Offer will not be made, directly or indirectly, in any Restricted
Jurisdiction unless by means of lawful prior registration or qualification under
the applicable laws of the Restricted Jurisdiction, or under an exemption from
such requirements. Accordingly, copies of this announcement are not being, and
must not be, mailed or otherwise distributed or sent in, into or from such
Restricted Jurisdiction. Persons receiving this announcement (including, without
limitation, custodians, nominees and trustees) must not distribute, mail or send
it in, into or from any Restricted Jurisdiction, and so doing may render any
purported acceptance of the Offer invalid.
The New Barclays Shares to be issued pursuant to the Offer have not been, and
will not be, admitted to trading on any stock exchange other than the London
Stock Exchange, Euronext Amsterdam, the New York Stock Exchange and the Tokyo
Stock Exchange.
Barclays Capital, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting as joint financial adviser to Barclays
Bank PLC and Barclays PLC and is acting for no-one else in connection with the
Offer, and will not be responsible to anyone other than Barclays Bank PLC and
Barclays PLC for providing the protections afforded to customers of Barclays
Capital nor for providing advice to any other person in relation to the Offer.
Citigroup Global Markets Limited ("Citigroup"), which is authorised and
regulated in the United Kingdom by the Financial Services Authority, is acting
as joint financial adviser to Barclays Bank PLC and Barclays PLC and is acting
for no-one else in connection with the Offer, and will not be responsible to
anyone other than Barclays Bank PLC and Barclays PLC for providing the
protections afforded to customers of Citigroup nor for providing advice to any
other person in relation to the Offer.
Credit Suisse Securities (Europe) Limited ("Credit Suisse"), which is authorised
and regulated in the United Kingdom by the Financial Services Authority, is
acting as joint financial adviser, joint sponsor and joint corporate broker to
Barclays Bank PLC and Barclays PLC and is acting for no-one else in connection
with the Offer, and will not be responsible to anyone other than Barclays Bank
PLC and Barclays PLC for providing the protections afforded to customers of
Credit Suisse nor for providing advice to any other person in relation to the
Offer.
Deutsche Bank AG ("Deutsche Bank"), which is authorised under German Banking Law
(competent authority: BaFin - Federal Financial Supervising Authority) and with
respect to UK commodity derivatives business by the Financial Services
Authority; regulated by the Financial Services Authority for the conduct of UK
business. Deutsche Bank is acting as joint financial adviser to Barclays Bank
PLC and Barclays PLC and is acting for no-one else in connection with the Offer,
and will not be responsible to anyone other than Barclays Bank PLC and Barclays
PLC for providing the protections afforded to customers of Deutsche Bank nor for
providing advice to any other person in relation to the Offer.
JPMorgan Cazenove Limited ("JPMorgan Cazenove"), which is authorised and
regulated in the United Kingdom by the Financial Services Authority, is acting
as joint financial adviser, joint sponsor and joint corporate broker to Barclays
Bank PLC and Barclays PLC and is acting for no-one else in connection with the
Offer, and will not be responsible to anyone other than Barclays Bank PLC and
Barclays PLC for providing the protections afforded to customers of JPMorgan
Cazenove nor for providing advice to any other person in relation to the Offer.
Lazard & Co., Limted, which is authorised and regulated in the United Kingdom by
the Financial Services Authority, is acting as joint financial adviser to
Barclays Bank PLC and Barclays PLC and is acting for no-one else in connection
with the Offer, and will not be responsible to anyone other than Barclays Bank
PLC and Barclays PLC for providing the protections afforded to customers of
Lazard nor for providing advice to any other person in relation to the Offer.
ABN AMRO Bank N.V. (Corporate Finance) is acting as financial adviser
exclusively to ABN AMRO Holding N.V. and to no one else in connection with the
Offer and will not regard any other person as a client in relation to the Offer
and will not be responsible to anyone other than ABN AMRO Holding N.V. for
providing the protections afforded to the clients of ABN AMRO Bank N.V.
(Corporate Finance) nor for providing advice in relation to the Offer.
Lehman Brothers Europe Limited, which is regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for ABN AMRO Holding N.V.
and no-one else in connection with the Offer and will not be responsible to
anyone other than ABN AMRO Holding N.V. for providing the protections afforded
to clients of Lehman Brothers Europe Limited nor for providing advice in
relation to the Offer.
Morgan Stanley & Co. Limited is acting exclusively for ABN AMRO Holding N.V. and
for no one else in connection with the Offer and will not be responsible to
anyone other than ABN AMRO Holding N.V. for providing the protections afforded
to clients of Morgan Stanley & Co. Limited nor for providing advice in relation
to the Offer.
N M Rothschild & Sons Limited is acting as financial adviser exclusively to ABN
AMRO Holding N.V. and to no one else in connection with the Offer and will not
regard any other person as a client in relation to the Offer and will not be
responsible to anyone other than ABN AMRO Holding N.V. for providing the
protections afforded to the clients of N M Rothschild & Sons Limited nor for
providing advice in relation to the Offer.
UBS Limited is acting as financial adviser exclusively to ABN AMRO Holding N.V.
and to no one else in connection with the Offer and will not regard any other
person as a client in relation to the Offer and will not be responsible to
anyone other than ABN AMRO Holding N.V. for providing the protections afforded
to the clients of UBS Limited nor for providing advice in relation to the Offer.
Goldman Sachs International, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting as financial adviser
exclusively to the Supervisory Board of ABN AMRO Holding N.V. and to no one else
in connection with the proposed merger and will not be responsible to anyone
other than the Supervisory Board of ABN AMRO Holding N.V. for providing the
protections afforded to the clients of Goldman Sachs International nor for
providing advice in relation to the Offer.
This announcement is published in the Dutch and English language. The English
version of the announcement is the only authentic text and shall prevail over
the Dutch text in the event of any contradictions between the two versions.
APPENDIX I
Pro Forma Financial Information to be filed with the SEC
In addition, in order to satisfy its disclosure obligations under US securities
laws Barclays expects to file today with the SEC a Current Report on Form 6-K
which contains, among other things, certain pro forma financial information for
Barclays relating to the proposed combination with ABN AMRO. ABN AMRO is also
preparing to file with the SEC a Current Report on Form 6-K which contains
certain pro forma financial information for ABN AMRO prepared in connection with
the proposed sale of LaSalle to Bank of America. Both the Barclays and ABN AMRO
Current Reports on Form 6-K will be available on the SEC's website at
www.sec.gov.
The pro forma financial information to be filed with the SEC reflects certain
assumptions about the proposed combination and includes appropriate adjustments
to account for the events directly associated with the proposed combination, but
does not include any potential revenue and cost synergies. If the proposed
combination does occur, the pro forma financial adjustments, may be subject to
material changes, including as a result of a final determination of the fair
value of the consideration to be provided and the fair values of assets acquired
and liabilities assumed.
APPENDIX II
Sources and Bases of Information
Save as otherwise stated, the following constitute the bases and sources of
certain information referred to in this announcement:
1. The values placed on the entire issued ordinary share capital of ABN AMRO
by the Offer and the proportion of the combined group which will be owned
by ABN AMRO ordinary shareholders and Barclays ordinary shareholders are
based on 1,852,448,094 ABN AMRO ordinary shares (as at 18 April 2007) and
6,542,555,046 Barclays ordinary shares in issue as at 20 April 2007.
2. The reference to significant and sustained future incremental earnings
growth for shareholders of the combined group is not intended, nor should
it be construed, as a profit forecast or be interpreted to mean that
earnings per ABN AMRO or Barclays share for the current or future financial
years, or those of the combined group, will necessarily match or exceed the
historical published earnings per ABN AMRO or Barclays share.
3. References to the combined group's cash earnings are references to profit
after tax and minority interests excluding the amortisation of the combined
group's identifiable intangible assets and integration costs incurred in
connection with the merger.
4. The available analysts' median forecast of ABN AMRO's earnings for 2010 is
EUR5394m. This has been adjusted to remove the proportion of earnings
relating to the LaSalle business being disposed (the LaSalle business
represents substantially all the profits of Business Unit North America
("BUNA")). This proportion has been assumed to be 21.7% based on the
average contribution forecast by analysts of EUR1052m to be made by BUNA to
ABN AMRO's consensus forecast earnings of EUR4853m in 2009 (being the last
year for which analysts split out the contribution of BUNA). This has then
been used to calculate the expected return on investment for 2010. The
calculation also takes into account interest income on retained capital,
the potential cost synergies and revenue benefits arising from the merger,
the associated restructuring cost and the consideration paid, less
approximately EUR12bn distributed to shareholders taking into account the
excess capital released by the sale of LaSalle. Neither the reference to
ABN AMRO's earnings for 2010 nor the return on investment statement are
intended, nor should they be construed, as a profit forecast or be
interpreted to mean that earnings per ABN AMRO or Barclays share for the
current or future financial years, or those of the combined group, will
necessarily match or exceed the historical published earnings per ABN AMRO
or Barclays share.
5. The total consideration of EUR67,151m is based on the closing price of
Barclays ordinary shares on 20 April 2007.
6. The implied price to earnings multiple has been calculated using 2006
profit attributable to ABN AMRO shareholders of EUR4,715 million.
7. The implied price to book multiple has been calculated using equity
attributable to ABN AMRO shareholders as at 31 December 2006 of EUR23,597
million.
8. All share prices quoted for ABN AMRO and Barclays shares are closing
prices, derived from Reuters.
9. The exchange rate used in this announcement is EUR 1.4739 : GBP1.00 as
published in the Financial Times on 21 April 2007
10. The financial information relating to Barclays has been extracted from its
consolidated audited annual accounts for the years to which such
information relates and the interim unaudited financial statements for the
relevant periods as published by Barclays, all of which are prepared in
accordance with IFRS.
11. The financial information relating to ABN AMRO has been extracted from its
consolidated audited annual accounts for the years to which such
information relates and the interim and quarterly unaudited financial
statements for the relevant periods as published by ABN AMRO for the
relevant periods, all of which are prepared in accordance with IFRS.
APPENDIX III
PRE-OFFER CONDITIONS
- No material adverse change in respect of Barclays or ABN AMRO.
- No third party has indicated an intention to take any frustrating action.
- All necessary notifications, filings and applications in connection with
the Offer have been made and all authorisations required to make the Offer
have been obtained.
- The authorisations required to complete the agreement with Bank of America
to acquire LaSalle or a sale and purchase agreement with another party with
respect to the acquisition of LaSalle have been obtained.
- Barclays and ABN AMRO have received notification from each of the DNB and
the FSA confirming that the FSA will be lead supervisor of the combined
group and the DNB and the FSA will be the consolidated supervisors of the
ABN AMRO and Barclays Groups respectively.
- 60 calendar days have passed following the date that Barclays application
under Section 3 of the United States Bank Holding Company Act of 1956, if
required, has been accepted for processing.
- Clearances and confirmations from the relevant tax authorities in The
Netherlands and the United Kingdom that Barclays will remain UK tax
resident have been obtained.
- All requisite employee consultations and information procedures with
employee representative bodies of Barclays and ABN AMRO have been
completed.
- All requisite corporate action has been taken in connection with the
appointment of certain individuals to the managing board and supervisory
board of ABN AMRO Bank N.V., subject to and with effect as of the time the
Offer is declared unconditional.
- Neither party becoming subject to any materially burdensome regulatory
condition.
- There is no indication that the New Barclays Shares will not be admitted to
the Official List of the UKLA, admitted to trading on the main market for
listed securities of the LSE, authorised for listing on the LSE, Euronext
Amsterdam and the Tokyo Stock Exchange and the New Barclays Shares, and
Barclays ADSs representing such shares or a portion thereof have been
approved for listing on the NYSE.
- There has been no event, circumstance or series of linked events or
circumstances that was not fairly disclosed in the annual reports and the
annual accounts for 2006 of ABN AMRO and Barclays respectively or otherwise
disclosed and that can reasonably be expected to have a negative impact on
the consolidated operating income in 2006 of ABN AMRO or Barclays of 5 per
cent. or more.
- The Merger Protocol has not been terminated.
OFFER CONDITIONS
- At least 80 per cent. of the issued ordinary shares of ABN AMRO have been
tendered under the Offer or are otherwise held by Barclays.
- No material adverse change in respect of Barclays or ABN AMRO.
- No third party has indicated an intention to take any frustrating action.
- All necessary filings, notifications, and applications in connection with
the Offer have been made and all authorisations and consents have been
obtained and relevant waiting periods have expired.
- The agreement with Bank of America to acquire LaSalle has completed in
accordance with its terms or a sale and purchase agreement with another
party with respect to sale of LaSalle has completed in accordance with its
terms.
- The competent regulatory authorities in the Netherlands have given their
declaration of no objection and the FSA has notified its approval of each
person who will acquire control over any United Kingdom authorised person
which is a member of the combined group or the relevant waiting period has
expired.
- Barclays and ABN AMRO have received confirmation from the DNB that it has
no objection to the parties proposal for the composition of the Managing
Board and Supervisory Board of ABN AMRO Bank N.V. and the FSA has approved
the appointment of certain nominated individuals to the board of directors
of Barclays Bank PLC following consummation of the Offer.
- The European Commission has declared the Offer compatible with the common
market or has granted its approval to the Offer and the applicable waiting
period under the HSR Act in relation to the Offer has expired or been
terminated.
- Neither Barclays nor ABN AMRO has received any notification from the DNB or
the FSA that there is likely to be a change in the supervisory, reporting
or regulatory capital arrangements that will apply to the combined group.
- The tax clearances from the relevant UK and Dutch tax authorities have not
been withdrawn or amended.
- Confirmation has been given that the New Barclays Shares will be admitted
to the Official List of the UKLA, admitted to trading on the main market
for listed securities on the Official List of the LSE, authorised for
listing on Euronext Amsterdam and the Tokyo Stock Exchange and the New
Barclays Shares and the Barclays ADS representing such shares or a portion
thereof have been approved for listing on the NYSE.
- The general meetings of shareholders of ABN AMRO and Barclays have passed
all agreed or required resolutions.
- There has been no event, circumstance or series of linked events or
circumstances that was not fairly disclosed in the annual reports and the
annual accounts for 2006 of ABN AMRO and Barclays respectively or otherwise
disclosed and that can reasonably be expected to have a negative impact on
the consolidated operating income in 2006 of ABN AMRO or Barclays of 5 per
cent. or more.
- The Merger Protocol has not been terminated.