Factbox - Details of Fortis partial nationalisation

Mon Sep 29, 2008 10:52am BST
 
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AMSTERDAM (Reuters) - The Belgian, Dutch and Luxembourg governments have agreed to inject 11.2 billion euros (8.9 billion pounds) into Benelux banking and insurance company Fortis, which will sell the parts of Dutch bank ABN AMRO that it bought last year.

Following are details of the steps announced by Fortis to restore confidence in the financial group:

* Fortis is selling stakes in its respective banking operations in Belgium, the Netherlands and Luxembourg to those respective governments while keeping its insurance and asset management operations. The effective Benelux governments' stakeholding in the total Fortis group would be close to 40 percent, according to Fortis Chief Financial Officer Lars Machenil.

* Belgium's government is investing 4.7 billion euros in Fortis Bank NV/SA (Belgium) for a 49 percent common equity share.

* The Dutch government is investing 4 billion euros in Fortis Bank Nederland (Holding) NV for a 49 percent stake. A new category of shares will be issued by the Dutch unit to the Dutch central bank (DNB). The new share category will not be entitled to the proceeds of any ABN AMRO stake sale.

* Luxembourg's government is investing 2.5 billion euros in Fortis Banque Luxembourg SA via a mandatory convertible loan that if converted, would result in 49 percent ownership.

* Fortis will sell its interest in ABN AMRO by divesting its stake in the holding company controlling it, which was created with consortium partners Royal Bank of Scotland and Santander when they took over ABN a year ago.

* A sale of ABN below the acquisition price of 24 billion euros would trigger an impairment. Any sale price below 12 billion euros would negatively impact core equity.

* With the resignation of incumbent Maurice Lippens, a new chairman "will be recruited from outside the company in consultation with the Belgian government." The governments of Belgium, the Netherlands and Luxembourg will receive "significant board representation."  Continued...

 
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