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Chief Exec. of the Bank of Scotland Peter Burt
"Natwest is a great business which has been undermanaged for many years"
 real 28k

Friday, 7 January, 2000, 07:41 GMT
BoS: We will reverse NatWest decline

cash machines NatWest also faces a bid from the Royal Bank of Scotland

The Bank of Scotland can reverse the decline of NatWest Bank, its chief executive Peter Burt claimed on Friday.

Battle for Natwest
"NatWest is a great business which has been undermanaged for many years. It has been losing market share and is very inefficient. We intend to turn it round," Mr Burt said.

Mr Burt was responding to earlier claims by NatWest that bank mergers are risky and can destroy shareholder value.

"There is no question that well planned mergers do work. We have been working on the NatWest transaction for over two years," Mr Burt added. "We are efficient and we grow business. We have been increasing market share, NatWest has been losing market share. We can reverse their decline."

NatWest is the subject of a bidding war between the Bank of Scotland and the Royal Bank of Scotland.

The Bank of Scotland's bid, originally launched on 24 September, is now worth about 22.8bn, excluding a special dividend of 1.20. The Royal Bank made its offer on 29 November, and its bid is valued at about 22.6bn.

The banks have until 14 February to convince NatWest shareholders of their case. Following a Christmas and New Year break in hostilities, the three banks are now expected to step up the battle to win over shareholders in the next month.

Fresh attack

The Bank of Scotland launched a fresh attack on its takeover target on Thursday.

The Scottish bank cited the Lloyds TSB merger and HSBC's acquisition of Midland as examples of mergers that have created shareholder value, dismissing NatWest claims that few mergers work.

The bank has previously said that its hostile bid for NatWest will yield savings of more than 1bn a year within three years.

"NatWest's stand-alone strategy offers a better, lower risk option with shareholders receiving 100% of the benefits," chairman and chief executive Sir David Rowland said.

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See also:
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The insatiable merger appetite
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