LLoyds TSB set to merge with HBOS

"Section " wrote

"... they are using a national interest clause in competition law to override any objections the watchdogs would have..."

Hmmm. If one of the even bigger banks comes up with a better offer for HBoS (eg HSBC or RBS?), then would the govt still support the (even bigger) merger?

If so, would it hurt the market to have such a big player? If not, then how can they be seen to favouritise Lloyds?

RBS and Barclays won't as they have too many problems of their own. HSBC might not actually be as bad on competition grounds as Lloyds. They have practically no presence at all in Scotland, so there are no competition problems there. In England, their presence in the current account and credit card markets is in the same order of magnitude as Lloyds, and their savings and mortgages is much lower. They are a bigger bank because they have a lot more overseas business and a lot more big company corporate business. HSBC were offered the chance to take over HBOS, and they turned it down as they wanted to be paid to take it over, while Lloyds was willing to pay for it.

Jonathan Bryce wrote: ...

Everyone's talking as if this was a done deal. Maybe it's a formality, but don't shareholders (both parties) have to vote on the issue first(*)?

Given that the U.S. seems to be finally doing something about what seems a root cause of all this aggro, which ought (from the accounts I've heard) to sort out HBOS's exposure, why should the deal go through? IIRC HBOS were trading at 222.5 last thing yesterday, and seem likely to go up. The offer price is only 232p.

(*) Mind you, given the 95% in favour result of the HBOS rights issue, I wonder if the tellers have already done the counting :-)

Bitstring , from the wonderful person Mike Scott said

I thought the offer price was 0.xx Lloyds TSB shares? In which case if the Lloyds share price goes up (which it did) the effective offer price goes up??

Not what I heard - which was 232p, paid in Lloyds shares. But anyway, suppose [we] shareholders veto the deal??

Maybe I'm cynical, but there's an excuse to push through a deal that ordinarily wouldn't be allowed. A main beneficiary "just happens" to be a great pal of GB, who's sees this as a quick short-term fix for his own multiple problems (what's new in that?). And the deal is announced with singular rapidity. Hmmm.