Negotiation Skills

Group 9 – ABN AMRO and

Barclays Merger
SWOT- ABN AMRO
Strengths
•No 1 Dutch bank
•No 13 world wide
•Established in 1826
•4500 branches in 53 countries
•Emerging Asian markets
•Expertise in global cash and
payment infrastructure
Threats
•The London-based Children's
Investment Fund with 1% of ABN
AMRO's shares but has led a
campaign to instigate change at the
bank
Weaknesses
•Poor performing stock
•Applied pressure from stock
holders to break company into
smaller entities and to sell these
individually.
Opportunities
•Many companies are vying for parts
/ whole of the company to support
their US/ UK / Europe operations.
•Expansion through mergers
SWOT - Barclays
Strengths
•No 4 bank globally
•28th in market capitalization
•Strong foot print in UK, US, Europe,
•Africa and middle East
•27 million customers and clients in
more than 50 countries.
Threats
•Royal Bank of Scotland is currently
leading a $72bn consortium counter-
bid for ABN AMRO.
Weaknesses
•No customer base in emerging
markets
Opportunities
•To expand globally
•Barclays existing product
capabilities can be considerably
enhanced, particularly in
commodities, FX, equities, M&A,
corporate broking, structured credit
and private equity
 Win-Win merger-
Different areas of expertise
ABN AMRO Trade finance , payment services and commercial banking.
Barclays Investment banking and investment management.

Two complementary geographical footprints

ABN Amro in Asia and Latin America and Netherlands
Barclays in UK ,US, Africa etc

“Creates is a group offering better capabilities to

more customers and in more places than either
franchise could individually”.
Tradables
Price

hicago Based ABN AMRO – LaSalle Bank

Employees and compensation

Board structure

Share holding pattern

Head office location

New company Name

Regulator Board
It will create :
•The 3rd largest bank

•47 million customers

•World’s leading transaction banking platforms

•A top five card issuer outside the US with around 27m cards.

•A premier global investment bank that is a leader in risk

management and financing

•The world’s largest institutional asset manager, with enhanced retail

distribution capabilities and complementary products .

•The world’s eighth largest wealth manager, with a leading European

onshore franchise and highly attractive positions in growth markets
Advantages for ABN Amro

ABN AMRO shareholders will get 3.225 ordinary shares of new corp./ share

BN AMRO will own 48% of the shares of the new company

ead Quarters in Amsterdam

erger will lead to significant increase in ABNs cash earnings per share for
accepting ABNs ordinary share holders

he merger will develop product development trainings

BN Amro will sell LaSalle Bank Corporation to Bank of America Corp for
BATNA For ABN AMRO

ABN AMRO could look into other banks in the European markets for merger

Accept Royal bank of Scotland Offer

Advantages for Barclays
Barclays will have the Dutch market also to capture with diversified customer
base and geographic mix

Barclays plan to use ABN AMROS back office system, they plan to
consolidate the data centers, save from the telecom ops, 29% of the money
will be saved by doing so

Barclays existing share holders will own 52% of the shares

ew Board will consist 10 members from Barclays and 9 from ABN. The CEO
the president will be from Barclays. The chairman from ABN.

Company will be called Barclays PLC

he merger will develop product development trainings

BATNA For Barclays

Barclays could look into other banks in the European markets for merger

Barclays could start their operations in a big way in Holland, Scotland and
other places and slowly increase the customer base
 Barriers to Merger
• Blocked sale of US unit LaSalle to Bank of America Corp
▫ Merger complicated by a rival bid for ABN Amro, including
LaSalle, by a consortium of banks - Royal Bank of Scotland,
Belgium’s Fortis and Spain’s Satander

▫ At the annual meeting of ABN Amro on 26th April, shareholders

decided to sue the sale

▫ RBS offering to pay more for both entities

▫ ABN CEO contends a shareholder vote not required as the unit

accounts for less than 30% of the bank’s total assets

▫ The Supreme Court ruling before July 13

Thank You!!!