TCI Break-Up Bid Puts Pressure On ABN-Barclays Deal

Apr 12 2007 | 12:25pm ET

Under pressure from hedge fund The Children’s Investment Fund, Barclays and ABN Amro are scrambling to put a deal together to preempt TCI’s drive to break up the Dutch investment bank.

ABN is holding exclusive merger talks with Barclays, with the exclusivity period schedule to end on Wednesday. Both sides expect a slew of hostile bids after a deal is announced, but the real deadline is April 26. That’s when both banks hold their annual shareholder meetings, and ABN will face two resolutions, pushed by TCI, calling for it to be split up.

The exclusive talks with Barclays have further angered TCI, which has been highly critical of ABN’s share price performance.

According to published reports, full terms of any deal—assuming one is reached—may not be disclosed when it is announced. While both sides hope to make some sort of announcement on April 18, an agreement is reportedly far from completed.

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