Fortis faces cut-price ABN sale after ING quits

LONDON (Reuters) - Fortis NV (FOR.BR) may get less than a third of the price it paid for the ABN AMRO assets it bought less than a year ago after a plunge in bank valuations and the withdrawal of the front-runner to buy the unit, analysts said.

ING Groep NV (ING.AS) had been expected to buy ABN's Dutch banking assets, according to people familiar with the matter, but the Dutch banking and insurance firm said late on Monday it had decided not to make an offer.

"ING has examined the situation closely and carefully," it said in a statement. It remained disciplined on deals "especially in the current extraordinary market circumstances" and said a deal "would not meet its financial requirements."

ING's shares tumbled 18 percent on Monday as financial markets were battered by fears about the financial health of banks around the world, potentially swaying its decision to retreat. Its withdrawal leaves no obvious buyer.

Any buyer was already expected to pay far less than the 24 billion euros (19.4 billion pounds) put up by Fortis.

Jaap Meijer, an analyst at Dresdner, said earlier on Monday that ING was the most likely buyer, but would only pay about 7 billion euros.

Analysts at Cazenove estimated the business would fetch about 10 billion euros.

Fortis said any sale below its purchase price will result in an impairment and any sale below 12 billion euros would hurt its core equity.

The sale of the business bought just 11 months ago was announced alongside a partial nationalisation of Fortis by the governments of Belgium, Netherlands and Luxembourg.