Barclays agrees £45.5bn ABN takeover

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Barclays Bank has agreed a takeover of Dutch bank ABN Amro in a deal worth around £45.5 billion.

The proposed merger of the pair, expected to complete during the fourth quarter of 2007, will create a joint client base of 47 million customers with around 90 per cent of its clients in seven key markets.

Barclays says the deal will "create a strong and competitive combination for its clients with superior products and extensive distribution" alongside "sustained future incremental earnings growth for shareholders".

Amsterdam-based ABN Amro and Barclays predict that the merger will result in annual pre-tax profits of approximately €3.5 billion (£2.3 billion) by 2010, boosted by its reach across Europe.

"Exclusive preliminary discussions" began between the pair almost a month ago, culminating in today's announcement and what is thought to be the world's biggest bank takeover to date.

However the news of the merger will not be positive for everyone, with 12,800 of the new company's staff expected to be made redundant. A further 10,800 full-time equivalent positions are expected to be moved offshore to low-cost locations.

"This proposed merger represents a unique opportunity to create a new competitive force in financial services, which will deliver benefits for our customers and clients and generate sustained growth and additional value for our owners," John Varley, chief executive of Barclays, said.

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