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Royal Bk Scot.Grp. (NWG)

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Monday 16 July, 2007

Royal Bk Scot.Grp.

Statement re ABN AMRO

Royal Bank of Scotland Group PLC
16 July 2007


The Royal Bank of Scotland Group plc                      16 July 2007


RBS's Acquisition of ABN AMRO Businesses


Following the ruling of the Dutch Supreme Court regarding the sale of LaSalle,
RBS, Fortis and Santander have today announced revised terms for their proposed
offer for ABN AMRO as set out in the Banks' Press Release.


RBS's announcement of 29 May 2007 set out the rationale for its participation in
the proposed offer to acquire ABN AMRO.  That announcement remains unchanged
except in relation to LaSalle.


RBS intends to continue with the acquisition of the Global Wholesale Businesses
and International Retail Businesses of ABN AMRO ('the ABN AMRO Businesses').
Instead of acquiring LaSalle, RBS will acquire cash from the sale of LaSalle
and, in the absence of LaSalle, the synergies anticipated in North America have
been revised.


The consideration for the ABN AMRO Businesses net of the sale of LaSalle will be
€16 billion, of which €5 billion will be financed by equity.


RBS believes that this transaction will provide enhanced growth prospects and
attractive financial returns.  As a result of the transaction, RBS expects to
deliver cost savings amounting to €1,237 million (or €1,319 million, including
its share of central cost savings) and net revenue benefits amounting to €481
million, by the end of 2010.


On RBS's forecasts for business growth and transaction benefits, the internal
rate of return on the acquisition of the ABN AMRO Businesses will be 15.5%
post-tax, well above the Group's hurdle rate of 12% post-tax.  The acquisition
is expected to deliver a post-tax return on investment(1) of 13.2% in 2010, and
to increase Group adjusted earnings per share(2) by 2.0% in 2009 and by 7.0% in
2010.


Sir Fred Goodwin, Group Chief Executive, said:


'The acquisition of the ABN AMRO Businesses remains compelling from a financial
point of view, as evidenced by the fact that it produces essentially the same
earnings enhancement for the Group, despite the smaller size of the transaction.
From a strategic perspective, whilst we would have preferred to acquire
LaSalle as well, the businesses we are acquiring open up many new markets and
growth opportunities, enabling us to significantly accelerate our strategic
development.'


(1) Return on investment defined as profit after tax plus post-tax transaction
    benefits over consideration plus post-tax integration costs

(2) Adjusted for purchased intangibles amortisation and integration costs


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Investor, Analyst and Press Information


The following conference calls will be hosted today 16 July 2007 by Sir Fred
Goodwin, RBS Group Chief Executive:


ANALYSTS AND INSTITUTIONAL INVESTORS - 9.00am (BST), 10.00am (CET)

•        Dial-in details:

-          UK Toll:                                   +44 207 138 0811

-          UK Toll free:                              0800 028 7847

-          US Toll:                                   +1 718 354 1193

-          US Toll free:                              1888 893 9532

•        Replay details:

-          UK Toll:                                   +44 20 7806 1970

-          UK Toll Free:                              0800 559 3271

-          US Toll:                                   +1 718 354 1112

-          US Toll Free:                              1866 883 4489

-          Passcode:                                  6246521



NEWSWIRES - 7.30am (BST), 8.30am (CET)

•        Dial-in details:

-          UK Toll:                                  +44 207 138 0811

-          UK Toll free:                             0800 028 7847

-          US Toll:                                  +1 718 354 1193

-          US Toll free:                             1888 893 9532

-          Spain Toll:                               +34 914 533 434

-          Spain Toll free:                          800 099 465

-          Netherlands Toll:                         +31 20 713 2789

-          Netherlands Toll free:                    0800 026 0068


MEDIA - 11.00am (BST), 12.00pm (CET)

•        Dial-in details:

-          UK Toll:                                  +44 207 138 0811

-          UK Toll free:                             0800 028 7847

-          US Toll:                                  +1 718 354 1193

-          US Toll free:                             1888 893 9532

-          Spain Toll:                               +34 914 533 434

-          Spain Toll free:                          800 099 465

-          Netherlands Toll:                         +31 20 713 2789

-          Netherlands Toll free:                    0800 026 0068

•        Replay details:

-          UK Toll:                                  +44 20 7806 1970

-          UK Toll Free:                             0800 559 3271

-          US Toll:                                  +1 718 354 1112

-          US Toll Free:                             1866 883 4489

-          Passcode:                                 6043979


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Important Information


In connection with the proposed Offer, RBS expects to file with the SEC a
Registration Statement on Form F-4, which will constitute a prospectus, and the
Banks expect to file with the SEC a Tender Offer Statement on Schedule TO and
other relevant materials. INVESTORS ARE URGED TO READ ANY DOCUMENTS REGARDING
THE PROPOSED OFFER IF AND WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. Investors will be able to obtain a copy of such
documents, without charge, at the SEC's website (http://www.sec.gov) once such
documents are filed with the SEC. Copies of such documents may also be obtained
from RBS and the other Banks, without charge, once they are filed with the SEC.


This communication shall not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such
jurisdiction. This press release is not an offer of securities for sale into the
United States. No offering of securities shall be made in the United States
except pursuant to registration under the US Securities Act of 1933, as amended,
or an exemption therefrom.


Forward-Looking Statements


This announcement includes certain 'forward-looking statements'. These
statements are based on the current expectations of RBS and are naturally
subject to uncertainty and changes in certain circumstances. Forward-looking
statements include any statements related to the benefits or synergies resulting
from a transaction with ABN AMRO and, without limitation, statements typically
containing words such as 'intends', 'expects', 'anticipates', 'targets',
'plans', 'estimates' and words of similar import. By their nature,
forward-looking statements involve risk and uncertainty because they relate to
events and depend on circumstances that will occur in the future. There are a
number of factors that could cause actual results and developments to differ
materially from those expressed or implied by such forward-looking statements.
These factors include, but are not limited to, the presence of a competitive
offer for ABN AMRO, satisfaction of any pre-conditions or conditions to the
proposed Offer, including the receipt of required regulatory and anti-trust
approvals, the successful completion of the Offer or any subsequent compulsory
acquisition procedure, the anticipated benefits of the proposed Offer (including
anticipated synergies) not being realized, the separation and integration of ABN
AMRO and its assets and the integration of such businesses and assets by RBS
being materially delayed or more costly or difficult than expected, as well as
additional factors, such as changes in economic conditions, changes in the
regulatory environment, fluctuations in interest and exchange rates, the outcome
of litigation and government actions. Other unknown or unpredictable factors
could cause actual results to differ materially from those in the
forward-looking statements. RBS does not undertake any obligation to update
publicly or revise forward-looking statements, whether as a result of new
information, future events or otherwise, except to the extent legally required.


Merrill Lynch International, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting as financial adviser to
Fortis, RBS and Santander and as underwriter for Fortis, RBS and Santander, and
is acting for no one else in connection with the proposed Offer, and will not be
responsible to anyone other than Fortis, RBS and Santander for providing the
protections afforded to customers of Merrill Lynch International nor for
providing advice to any other person in relation to the proposed Offer.


The Royal Bank of Scotland plc, which is authorised and regulated in the United
Kingdom by the FSA, is also acting as financial adviser to RBS and is acting for
no one else in connection with the proposed Offer, and will not be responsible
to anyone other than RBS for providing the protections afforded to customers of
The Royal Bank of Scotland plc nor for providing advice to any other person in
relation to the proposed Offer.


Any Offer made in or into the United States will only be made by the Banks and/
or RFS Holdings directly or by a dealer-manager that is registered with the SEC.


                      This information is provided by RNS
            The company news service from the London Stock Exchange                                                                                                                 

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