14/07/2008 12:00
Shares in Alliance & Leicester jumped more than 40 per cent in early Monday trade to 313½p on news of a 317p a share all-share takeover offer from an unnamed party, believed to be Santander of Spain.
A&L said it was in advanced discussions regarding a possible offer, priced at 299p a share combined with the right to receive an interim dividend of 18p per share, bringing the total potential offer to 317p per share. This puts a price tag of £1.33bn on the bank.
A&L would not be drawn on the identity of the potential acquirer, but people briefed on the discussions identified Santander, which late last year abandoned initial discussions with A&L over price.
Only last week A&L named a new chairman, appointing Alan Gillespie to the role left vacant by the death of Sir Derek Higgs in April. The appointment of Mr Gillespie was widely regarded as a move to help stabilise the bank amid fears that it could face further pain from the credit crunch.
Santander already owns Abbey, the fourth largest bank in the UK, and has been looking to expand its presence. A deal with A&L would further its ambitions to grow its branch network in the country, while also providing a platform to make a push into business banking, which Santander has identified as a new revenue stream.
A&L has taken a pummelling from the credit crunch. It shares have lost more than half their value since the beginning of the year, falling to their lowest levels ever last week to 213¼.p.
Shares in Santander shares were 0.5 per cent lower at €11.18 in early Madrid trading.
A&L said it was in advanced discussions regarding a possible offer, priced at 299p a share combined with the right to receive an interim dividend of 18p per share, bringing the total potential offer to 317p per share. This puts a price tag of £1.33bn on the bank.
A&L would not be drawn on the identity of the potential acquirer, but people briefed on the discussions identified Santander, which late last year abandoned initial discussions with A&L over price.
Only last week A&L named a new chairman, appointing Alan Gillespie to the role left vacant by the death of Sir Derek Higgs in April. The appointment of Mr Gillespie was widely regarded as a move to help stabilise the bank amid fears that it could face further pain from the credit crunch.
Santander already owns Abbey, the fourth largest bank in the UK, and has been looking to expand its presence. A deal with A&L would further its ambitions to grow its branch network in the country, while also providing a platform to make a push into business banking, which Santander has identified as a new revenue stream.
A&L has taken a pummelling from the credit crunch. It shares have lost more than half their value since the beginning of the year, falling to their lowest levels ever last week to 213¼.p.
Shares in Santander shares were 0.5 per cent lower at €11.18 in early Madrid trading.
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