Dutch govt buys Fortis' operations for $23.2 bn

LONDON: Within a few days of extending a lifeline to the beleaguered Fortis, the Netherlands Government has acquired the Dutch subsidiary of the banking and insurance major for about 16.8 bn euro.

In a statement issued on Friday, Fortis said the Netherlands government has snapped up Fortis Bank Nederland (Holding) N V including the participation in RFS Holdings B V that represents the acquired activities of ABN AMRO, Fortis Verzekeringen Nederland N V, and Fortis Corporate Insurance N V.

The deal, which has been approved by the Dutch Central Bank, is worth about 16.8 bn euro, it added.

Earlier, Fortis had received an investment worth 11.2 bn euro from the governments of Belgium, Netherlands and Luxembourg, in an effort to support the troubled entity in the ongoing credit crunch.

Under the agreement reached with Fortis, the three governments would make investments in exchange for 49 per cent stake each in three different subsidiaries of the Belgian giant, falling in their respective jurisdictions.



While the government of Belgium would invest 4.7 bin euro in Fortis Bank NV/SA (Belgium), Netherlands would pump in four billion euro into Fortis Bank Nederland (Holding) NV and Luxembourg would inject 2.5 bn euro in Fortis Banque Luxembourg SA.

However, the transaction announced on Friday, replaces the previously announced investment of four bn Euro in Fortis Bank Nederland Holding N V.

Following the deal, Fortis Group entails Fortis Insurance Belgium, Fortis Insurance International and the banking activities excluding Fortis Bank Nederland (Holding) N V.

Fortis' took a beating in the ongoing credit crunch, after snapping a stake in ABN Amro.