ABN AMRO - The 'Peanut' Deal Doesn't Look So Bad Now

Isn't it interesting how, with the benefit of hindsight, something that was viewed fairly negatively at the time can look altogether different a few months later. Especially in the world of the financial markets. Take that deal that resulted in the carving up of ABN AMRO, for example.

ABN's management board were criticized last year for the way they (in)effectively auctioned the bank (it ended up going to the Royal Bank of Scotland consortium, of course). Many felt that the $111bn that the firm eventually went for was peanuts, and some shareholders even considered legal action to try force the board to open up the sale process to other parties.

Fast-forward a few months, however, and that deal now looks great for ABN shareholders. At the moment, it would only cost $117bn to acquire Lehman Brothers (market cap $23bn), Merrill Lynch ($44bn) AND Morgan Stanley ($50bn). Or, for $111bn, you could pick up Goldman Sachs ($66bn) and still have enough left over to buy Bear Stearns 37 times!

Finally, Reuters reports that 80-year-old former Bear CEO 'Ace' Greenberg intends to stay on after the JPMorgan takeover. He expects to be told what his new role will be when he has lunch with JPMorgan executives next week. 'Ace' has been with the firm for 58 years!