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Royal Bank of Scotland led consortium makes bid for Dutch financial services group ABN Amro

The consortium of banks led by Royal Bank of Scotland Group PLC said today that it will move ahead with a €71.1 billion ($95.61 billion) takeover bid for Dutch financial services group ABN Amro Holding NV, topping a bid from Barclays PLC and continuing a struggle with Bank of America for control of ABN Amro's La Salle bank in Chicago.

The consortium, which includes the Dutch bank Fortis NV and Spain's Santander Central Hispano SA, said the offer comprises 79% in cash and the issue of new shares in Royal Bank of Scotland Group PLC. The cash component was originally 70% in a proposed offer outlined in April. The consortium said the €38.40 is a 13.7% premium over the value of Barclays PLC's rival offer.

On April 23, ABN Amro Holding NV announced a $21 billion sale of LaSalle to Bank of America, together with news that Barclays had made a friendly offer for ABN Amro valued at €36.25 a share. The sale of LaSalle was a condition of the Barclays deal. A Dutch court has frozen the sale of LaSalle, saying ABN Amro's management overstepped its bounds by attempting to sell it without shareholder approval and Bank of America filed suit in a US federal court, saying its purchase contract is enforceable under US law.

Sir Fred Goodwin, RBS Group Chief Executive, said: “Given the natural assumption that a consortium approach would bring furthercomplexity, we are pleased to set out a straightforward proposal that is attractive to our own shareholders as well as those of ABN AMRO.” RBS, which owns the Irish bank Ulster Bank, will issue its trading statement in respect of the first six months of 2007 on Tuesday 5 June.

The group said that it continues to perform well in 2007 and expects the rate of underlying earnings growth in the first six months of the year to be slightly higher than that implied by the consensus earnings forecast of 72.1p for the full year. (