Former chiefs oppose merger
Updated on 08 November 2008
HBoS has rejected a bid by two retired bank chiefs to scupper the £12bn Lloyds TSB takeover deal, reports John Sparks.
The deal was put together this September with help from the treasury, in the hope that Lloyds could prevent the collapse of its larger but weaker rival.
But Sir Peter Burt, former boss of Bank of Scotland, and Sir George Mathewson, former head of RBS, say that HBOS is in fact stronger, better funded and more profitable than Lloyds - but the deal would only give HBoS shareholders 20 per cent of the merged bank, while the Lloyds shareholders get more than 36 per cent.
The pair wrote to current chairman Sir Dennis Stevenson, saying that "the terms of the takeover are unfair to HBOS shareholders and we believe there are better options available, which the Board should be exploring."
They will ask HBOS shareholders to sack him and the chief exec, Andy Hornby, and appoint them to rebuild a standalone HBoS, or negotiate a better deal with Lloyds. HBOS says it has explored the option of remaining independent, but felt that a takeover was a better deal.
