TCI’s ABN Amro Bid Riles Dutch Regulator

Feb 26 2007 | 10:58am ET

Christopher Hohn knows how to get under regulators’ skin. Already persona non grata in Germany for his role in sinking the Deutsche Börse’s bid for the London Stock Exchange, his Children’s Investment Fund’s latest move has earned the ire of the head of the Dutch central bank.

Hohn’s hedge fund is pushing for the breakup of Dutch banking giant ABN Amro, a move that De Nederlandsche Bank President Nout Wellink says is “a bridge too far.” He complained to a Dutch newspaper that, “TCI’s letter implies, ‘you work out what you are going to sell, but send the proceeds to us.’”

ABN has yet to respond to TCI’s letter or to the five draft resolutions it hopes to present during the bank’s annual shareholder meeting in April. The London-based hedge fund owns a 1% stake in ABN, though the bank says it believes other hedge funds have built up similar stakes. Wellink warned that any hedge fund group hoping to pool its shares and vote as a bloc would need his permission to do so.

TCI’s successful effort to stop Deutsche Börse from acquiring the LSE led to the resignation of CEO Werner Seifert, and earned Hohn and hedge funds a lot of antipathy in Germany. The collapse of the bid led Franz Müntefering, then-head of the country’s Social Democratic Party and current vice chancellor, to tar hedge funds with the snide sobriquet “locusts.” Germany is now leading the charge to enact some sort of international hedge fund monitoring.

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