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Last Updated: Friday, 4 May 2007, 20:21 GMT 21:21 UK
ABN Amro sued over bank dispute
Branch of LaSalle bank
The row over LaSalle's future has soured the Barclays bid
Bank of America is to sue ABN Amro after it was blocked from buying ABN's US bank, complicating bids for ABN from Barclays and Royal Bank of Scotland.

Bank of America launched the action after a Dutch court froze its planned purchase of LaSalle, ruling the deal was illegal without investor approval.

LaSalle's sale is a key part of ABN's planned $90bn (�45bn) Barclays merger.

A rival consortium led by the Royal Bank also wants to buy ABN but, unlike Barclays, wishes to retain LaSalle.

Other parties interested in buying LaSalle now have until to the end of Sunday to express their interest in a deal.

'Delay and uncertainty'

Bank of America said it had a legally-binding agreement with ABN to buy LaSalle.

As well as claiming damages from ABN Amro over the $21bn sale of LaSalle, Bank of America is seeking an injunction to block its sale to any other bidder.

The wrangling over LaSalle's future had caused "delay and uncertainty" to its business, Bank of America said, and it was entitled to seek financial redress.

The level of damages sought has not been specified, but media reports have suggested the claim could be as high as $220bn.

Barclays building
Barclays is locked in a high-stakes battle over ABN Amro

ABN Amro said it was aware of the lawsuit but would not comment on it.

The growing legal row over LaSalle's future threatens to delay or even scupper the ABN-Barclays deal, which would be the world's largest banking merger.

The court ruling was a victory for ABN shareholders, who argued that the bank had failed in its duty to open talks with other potential bidders as well as Barclays.

They said the plan to sell LaSalle without the backing of shareholders was against Dutch law and represented a "poison pill", effectively deterring other bidders from entering the fray.

Most ABN shareholders want its management to sell the business to the highest bidder.

The Royal Bank of Scotland consortium - which also includes Spain's Santander bank and Dutch-Belgian group Fortis - has said it could offer �49bn for ABN Amro, trumping Barclays.




SEE ALSO
Court blow to Barclays ABN deal
03 May 07 |  Business
'Legal threat' over ABN bank sale
30 Apr 07 |  Business
RBS woos ABN with �49bn bid plan
25 Apr 07 |  Business
ABN Amro investors in bid revolt
26 Apr 07 |  Business
Barclays agrees �45bn Dutch deal
23 Apr 07 |  Business

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