Barclays: Predator or prey?
Chris Hohn may have done it again. In 2005 the campaign of his TCI hedge fund against to buy the London Stock Exchange precipitated nothing short of revolution in the ownership of Europe's stock markets - whose consequences are still being played out.
Now TCI has acquired a 1 per cent stake in the pride of Dutch banking and is trying to force it to dispose of overseas interests and consider selling itself whole to another bank.
Enter Barclays. As the , Barclays has been in touch with ABN to offer itself as a potential white knight against the gathering hordes of hedge funds.
I don't expect ABN to give itself over to the tender care of Barclays soon. Dutch banks never act precipitately. Apart from anything else, there'll be plenty of other European banks keen to "rescue" ABN, which may include our own Royal Bank of Scotland and Lloyds TSB (both of which would in some ways be a better strategic fit with ABN in view of their mix of businesses) and Scandinavia's Nordea.
In fact the outing of Barclays may turn out to be something of a mixed blessing for the UK's number three bank. The possibility that Barclays is about to supersize itself could prompt Bank of America to at last make its long-mulled attempt to swallow the Blue Eagle (Barclays and Bank of America held merger talks before B of A went on its last US shopping spree).
So TCI may have started dominos tumbling that could ultimately lead to those long-rumoured, seismically important but elusive banking events: a really substantial cross-border merger of two huge European banks and - whisper it - a mega Transatlantic banking deal.
Update 19:00 GMT: Barclays will confirm tomorrow morning that it has held exploratory talks with ABN. It feels obliged to make a statement, under UK listing rules. By contrast, ABN's preference would be to say nothing - though its silence, if maintained, will look very odd.
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So Peston, the hedge funds (of which TCI is one) do have some use after all? Notwithstanding the fact that they charge very large fees and Chris Hone is reputed to have made a personal fortune of over Β£1.5 billion in just three years from those fees? Let's face it if he has made a fortune, he is worth every penny. Its not many people who can spot the opportunities, get the timing right, take on powerful vested interests, persuade investors to back you and manage the complex personalities who work in hedge funds.
Worth remembering that Chris Hohn is a son of (white) Jamaican immigrants who came to he Uk in 1960 and Pemira is led by a black guy, Damon Buffini. The contribution of these people and others like then who exist in vast numbers in the City is not included in Migration watch's statistics about the contribution of immigrants...its worth accepting everyone to find a few of these geniuses. They and people like them make London the centre of global finance and that is worth billions to the economy
The potential of ABN will suit a certain person in Barclays (Mr Diamond) very well, Bob's desire to expand his empire and particularly his baby Barclays Capital into a true world force in Investment banking would prove pretty compelling.
Barclays is I believe cash rich so a predator rather than a prey particularly a prey poached by BOA would be better for the market to take.
About time, let's hope this one (or another one) comes off! And soon. The last of the dinosaurs - it has to change
Barclays may be a dinosaur in terms of its age but in most other respects its evolution into a modern banking behemoth is complete. It has avoided being taken over by making itself too expensive in terms of market capitalisation. A substantial overhaul of its management structure together with John Varley's success in raising the 'metabolic rate' of the business makes it a take-over waiting-to-happen. Dutch sensibilities will require the cloak of a 'merger' but make no mistake the Varley, Diamond, Segers axis will ensure that banking in ABN's present markets quickly takes on a very Barclays flavour. If successful, I doubt Barclays customers in the UK (unless they are also shareholders) will notice any change at all.
Can you please explain why you have launched the 5.30pm story on Βι¶ΉΤΌΕΔ News BEFORE an appropriate RNS stock exchange announcement has been made?
OK this is bugging me, the abbreviation for ABN AMRO is not ABN if anything it's AAB. ABN AMRO comes from Algemeene Bank Nederland merging with the Amsterdam-Rotterdam Bank.
Unfortunately, I have banked with both of them, it's the least friendly UK bank joining the most arrogant Dutch one, if the customer's will notice anything I'm sure it won't be to their benefit.
It's ABN AMRO that's the dinosaur! Good luck to Barclays - they'll need it.
With this move Barclays are at last threatening to deliver the whole shooting match.
Todd et al beware though - the devil is in the detail!
I expect to be flamed any minute, branded as a carpetbagger reborn, but could this have any bearing on future payouts for existing/new Barclays/RBoS etc customers, regardless of being a shareholder or not?
In reply to Bruce Banner - Barclays and RBoS are publically listed companies and are therefore owned by their share holders. Building societies that gave out windfalls were 'mutual' and therefore owned by their customers. There will be no pay out for anyone from Barclays or RBoS, apart from potentially to shareholders.