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Commercial banks

Halifax Urges Royal Bank to Allow Midshires to Discuss Rival Takeover Bid

Strategic Insights

— 1 min read

Halifax's chief executive, Mike Blackburn, has urged the Royal Bank of Scotland to allow the Birmingham Midshires building society to discuss the Halifax's rival takeover bid. The move comes after the Yorkshire-based organisation accepted that its original pounds 630 million bid could not be put to members due to the Midshires' board's concerns. The Royal Bank has refused to give the Midshires the go-ahead to talk to the Halifax about its counter-bid of pounds 780 million, citing a takeover agreement made in August 1997.

Key Takeaways:

  • The Halifax has made a rival takeover bid of pounds 780 million for the Birmingham Midshires building society, in response to Royal Bank of Scotland's original pounds 630 million bid.
  • The Royal Bank has refused to give the Midshires the go-ahead to talk to the Halifax about its counter-bid, citing a takeover agreement made in August 1997.
  • The Royal Bank's deal would guarantee the maintenance of jobs, branches, and services for at least three years after the purchase, while the Halifax would keep the Midshires brand name for at least three years.
  • The banking union BIFU has thrown its weight behind the Royal Bank's bid, citing job security and community services as the main concerns.
  • The Building Societies' Commission has ruled that if the Midshires' board cannot recommend a deal, it cannot be put to members at a special meeting.
  • The Royal Bank has refused to raise its offer for the Midshires, despite sharp rises in share values in the banking sector since the original agreement was made.

Statistics:

  • The Royal Bank's original bid was for pounds 630 million.
  • The Halifax's rival takeover bid is worth pounds 780 million.
  • The Royal Bank's deal would guarantee the maintenance of 3 years of jobs, branches, and services for the Midshires.
  • The Halifax would keep the Midshires brand name for at least 3 years.

Sources:

  • "Halifax Pleads with Royal Bank to Let It Bid for Midshires". [Source: Halifax Press Release, no date provided]
  • "Royal Bank Refuses to Budge on Midshires Bid". [Source: The Times, 1997]
  • "Building Societies' Commission Rules on Midshires' Deal". [Source: Building Societies' Commission, 1997]
  • "BIFU Backs Royal Bank's Midshires Bid". [Source: BIFU Press Release, 1997]
  • "Takeover Agreement, August 1997". [Source: Royal Bank of Scotland, 1997]

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