ABN Financing Preference Shares Case Study

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Sales process
ABN shareholders received €35.60 ($49.20) in cash and 0.296 RBS shares for each ABN share held. The offer was valued at €38.40 ($50.70) per ABN share, with a total value of €71.1 billion ($93.87 billion) – 93.2 percent of the offer is provided in cash.
The banks intended to make a proposal for all the depository receipts that represented the ABN convertible financing preference shares consistent with the terms of the prospectus dated Aug. 31, 2004, relating to the ABN convertible financing preference shares. A cash offer will be made for the issued and outstanding formerly convertible preference shares of €27.97 ($36.93). The aggregate consideration payable for the formerly convertible preference shares will be approximately €1.2 million ($1.58
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RBS took up 38.3 percent of the offer with a takeover price of €27.2 billion ($35.91 billion).
Santander took over business unit Latin America, Antonveneta, Interbank, and DMC Consumer Finance. Santander paid up to €19.9 billion ($26.3 billion), 27.9 percent of the offer.
Outcome
In the year 2007, Rijkman Groenink, CEO of ABN Amro, received a salary of €778,000, termination payments of €4.9 milion (including pension costs) and a bonus of €1.4 million.
As part of the remuneration policy installed in 2001, Groenink owned 486,567 options and 28,822 matched shares of ABN AMRO. Moreover, Groenink privately held 77,012 shares of ABN Amro. As result of the takeover, the shares vested immediately and were sold to the consortium for €37.88 a share. This resulted in €22,440,149.88 in cash.
In total Groenink received €27,340,149.88 as a result of the takeover.
The €27 million was highly criticized by the public and media, so highly even, it raised questions in the Dutch
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