Just hours after announcing advanced talks with a mystery suitor, the Leicester, England-based group said Santander had agreed to pay 299 pence in stock per share, more than 36% above the bank's Friday closing price of 219.25 pence. The Spanish group will also pay a soon-to-be-declared first-half dividend of 18 pence per share, putting a 317 pence per share price on both components of the offer.
Speculation that Alliance & Leicester could attract an offer intensified in February when it announced a 29% decline in 2007 core profit. Santander, which owns Alliance & Leicester's larger rival Abbey National plc, had long been considered a potential bidder, as had France's Crédit Agricole SA and London-based Lloyds TSB Group plc.
The bank's brightening prospects are a marked contrast to those of certain rivals also hit by the sudden collapse of the country's buy-to-let mortgage market and a sharp downturn in regular mortgage lending.
Alliance & Leicester in May said it was able to secure short- and midterm financing in the first four months of the year, steps that have proved difficult for many peers. The group, however, said it wrote down £53 million in investment valuations and booked a £139 million loss on other treasury assets. -
Andrew Bulkeley and Laura BoardSee full story on
TheDeal.com
