Alternative HBOS takeover bid possible

A rival bid to Lloyds TSB’s proposed takeover of HBOS could emerge after it was confirmed today that talks have taken place about a possible alternative to the deal.

A rival bid to Lloyds TSB’s proposed takeover of HBOS could emerge after it was confirmed today that talks have taken place about a possible alternative to the deal.

Scottish Secretary Jim Murphy has had discussions with Jim Spowart, the founder of Intelligent Finance.

Edinburgh-based HBOS is the subject of a proposed £12bn (€15.2bn) merger with Lloyds TSB.

But it emerged today that Mr Spowart contacted the Secretary of State for Scotland earlier this week to discuss the possibility of a group putting together a rival bid.

The two men were having further talks today.

Mr Spowart told the BBC: “This is a genuine, genuine interest.

“I can’t emphasise that enough at this stage and just let’s hope for Scotland this is another alternative that we’re able to look at.”

He also suggested the rival deal could keep more jobs and decision making functions in Scotland.

Mr Spowart said: “What would attract myself to this would be that we’d keep the decision making in Scotland, or at least it would appear to keep the decision making in Scotland.

“It would keep the bank more or less intact, I can’t guarantee the situation on jobs but I don’t think there would be job cull at the same level as what is currently estimated or anticipated by Lloyds TSB.”

An estimated 17,000 HBOS jobs are based in Scotland and it is feared thousands will be lost if the merger with Lloyds TSB goes through.

Today Mr Murphy confirmed he had had talks with Mr Spowart and said: “I have spoken to the Treasury and if there is a second serious bid then the Treasury would be happy to talk to them.”

The possibility of a second deal emerged the day after the Government gave Lloyds TSB’s planned merger with HBOS the green light after overruling competition concerns raised by the Office of Fair Trading.

Business Secretary Peter Mandelson said the public interest of “preserving the stability of the financial system” outweighed any potential anti-competitive effects.

Mandelson said: “I am satisfied that on balance the public interest is best served by allowing this merger to proceed without a reference to the Competition Commission.”

Earlier this week Scottish First Minister Alex Salmond met Lloyds TSB bosses in London to lobby for Scottish interests should the merger go through.

A spokesman for Mr Salmond said: “If any new bid or management team emerges for HBOS, the First Minister will approach that in exactly the same way he approached the Lloyds TSB bid, which is making the positive case for Scotland and making sure that those involved see the value of retaining jobs and decision making in Scotland.

“Any bid has to be judged against what is in the best interests of Scotland in terms of jobs, decision-making and competition.”

Scottish Liberal Democrat leader Tavish Scott discussed the proposed merger of Lloyds TSB and HBOS with Mr Murphy at a meeting earlier this week.

He said: “The UK Government must give a fair wind to any other interested party providing a credible financial alternative that will keep competition in the banking market place.”

But SNP MSP Alex Neil, a member of Holyrood’s Finance Committee, attacked the UK Government’s position on HBOS calling it “totally incoherent”.

“On the one hand, Peter Mandelson is going pell mell for the Lloyds TSB takeover, and completely disregarding the dangers flagged up in the OFT report - including to banking services for small businesses in Scotland,” he said.

“On the other hand, Jim Murphy is publicising a possible alternative bid.

“What is abundantly clear is that there must be a pause for reflection now so that the best interests of Scotland can be properly evaluated, and all options considered – including HBOS remaining an independent bank.

“The UK Government have tried to rush this takeover through in defiance of Scottish interests. They should have been looking at all options, and it is disgraceful that it has been left to others to do so.

“All options must be considered on equal terms, so that whatever finally emerges reflects the best interests of retaining jobs, decision making and competition for the people and businesses of Scotland.”

More in this section

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo
IE-logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up