(25 July 2008 – Australia) The Commonwealth Bank has revealed that it is in discussion to buy ABN AMRO Australia after rival NAB pulled out of the race.CBA has advised that it is now in talks with Royal Bank of Scotland to acquire ABN AMRO Australia Holdings Pty Ltd (ABN AMRO).
CBA and RBS have entered into a period of exclusivity around negotiations and due diligence. The deal being discussed is in the range of $450 million to $500 million.
In announcing the discussions, CBA said that the acquisition would fit well with the CBA business and enhance its range of services.
The bank said that the ABN AMRO Australian and New Zealand businesses would be complementary to the Commonwealth Bank’s Institutional Banking & Markets business and would enhance the range of services that the bank offers in the financial markets areas.
Ralph Norris, CBA’s chief executive, said ABN was a scalable asset and a good fit for the bank.
He also said ABN’s specialist institutional banking operations could be a significant bolt-on advantage, and the institutional equities business would complement the group’s retail brokerage, CommSec.
Any final agreements would still require CBA’s board approval as well as all necessary competition and regulatory approvals.