Santander promises Alliance and Leicester staff security after takeover

Aug 20 2008 by Alex Turner, Liverpool Daily Post

THE future of Alliance and Leicester Commercial Bank in Bootle will be secure if a £1.26bn takeover by Banco Santander is confirmed.

That was the message from Spanish bank Santander, which already owns UK high street bank Abbey, which last month launched a bid to buy A&L.

Santander yesterday issued its bid prospectus in which it said it had no plans to make any “material change” to A&L’s principal locations, which includes Bootle, or the conditions of employment for its staff, including pension rights.

The 2,000 Bootle-based staff, whether full-time or part-time, were also boosted by the news they will each receive 100 free shares – worth around £950 – if the takeover is completed. The shares for staff will have a total value of £7.25m. Santander, which is Europe’s biggest bank, said that, while jobs would be lost through the integration of its back office functions with Abbey, it believed this could be achieved while largely avoiding redundancies.

The proposed takeover is unanimously supported by the A&L board, which believes the greater stability and greater certainty offered by being part of the Santander Group, as well as the good strategic fit, represents value for shareholders.

A&L’s acting chairman Roy Brown said: “The proposed acquisition would bring together in the same group two well known UK banks and create a more effective competitor in UK financial services. The A&L board believes that the combination of A&L and Abbey is an excellent fit.

“The combined business in the UK will have 959 branches, a larger and therefore more competitive market share of key personal financial service products and a growing business banking franchise, with Banco Santander providing additional stability and resources to leverage A&L’s franchise.

“The result will be a stronger UK banking franchise that will benefit our customers and employees. It represents value for A&L shareholders by providing both greater stability and greater certainty in these uncertain times.”

The details of Santander’s proposals were contained in voting packs which were yesterday distributed to A&L shareholders. Shareholders have until September 14 to vote, and the court meeting and extraordinary general meeting will take place on September 16.

As well as being Europe’s biggest bank, it was one of the more financially robust banks, with no exposure to America’s sub-prime mortgage market troubles that have caused other banks around the world, including A&L, to write off large losses.

alex.turner