TSB takeover approach

Paul_1977

It looks as if IT systems will be transferred over to Sabadell's systems. Known as Proteo.

Sabadell believes that substantial savings will be derived from IT optimisation benefits (savings of approximately £160 million per annum on a pre-tax basis are anticipated in the third full year after completion of the Offer).

 Lloyds will provide £450 million in support to deliver the migration of the IT transitional services currently provided by Lloyds onto Sabadell's Proteo platform.

Tablet screenshot below:

http://blog.bancsabadell.com/2015/02/sabadell-movil.html

fifeken

I just got my paperwork through today asking me if I want to accept the offer from Sabadell for my shares.


I read from previous posts in this thread that the 5% Bonus due to shareholders will be forthcoming, but the wording on the TSB website worries me a bit. Basically it says that if the offer becomes unconditional before June 25th, the I'll get the equivalent of my 5%. From what I read, the offer at the moment is recommended, but not unconditional.


Can anyone tell me how this works whether I choose to accept the offer or not?

Paul_1977

TSB website?

I think it goes by what the paperwork you are signing says.

pafpcg

As I understand it, the "bonus" is the responsibility of Lloyds (who made the original offer of extra shares as part of their promotion of their sale of TSB). In the document announcing the recommended cash offer dated 20-March which stated the terms agreed between Sabadell and TSB, Section 17 "Bonus share scheme" contains the following:

“Accordingly. if the Offer is declared wholly unconditional before 25 June 2015, Lloyds will make arrangements to pay, to any investors who would have been entitled to receive such Lloyds Bonus Shares under the terms of the scheme, the cash value of those Lloyds Bonus Shares (at the offer price to be paid by Sabadell). In addition, if the Offer period extends beyond 25 June 2015 (whether or not the Offer is subsequently declared wholly unconditional or lapses), Lloyds intends to extend the compensation arrangements described above such that, in those circumstances, it will make arrangements to pay, to any investors who are entitled to receive Lloyds Bonus Shares under the terms of the scheme, the cash value of those bonus shares (again at the offer price to be paid by Sabadell). The Board of TSB has discussed these arrangements with Lloyds and is fully supportive of the arrangements.”

I'm not yet aware of how and when Lloyds will send any payment in lieu of the bonus shares.

fifeken

Paul_1977 wrote: »

TSB website?

Yes. The one that has a section showing the Offer Document and all the other documentation regarding the sale.

Paul_1977 wrote: »

I think it goes by what the paperwork you are signing says.

The paperwork that says "Do you want to Sell - Yes or No".


I was hoping someone with knowledge of the way these things work could explain the sale process, and how it affects the 5% bonus.

fifeken

pafpcg wrote: »

As I understand it, the "bonus" is the responsibility of Lloyds (who made the original offer of extra shares as part of their promotion of their sale of TSB). In the document announcing the recommended cash offer dated 20-March which stated the terms agreed between Sabadell and TSB, Section 17 "Bonus share scheme" contains the following:

“Accordingly. if the Offer is declared wholly unconditional before 25 June 2015, Lloyds will make arrangements to pay, to any investors who would have been entitled to receive such Lloyds Bonus Shares under the terms of the scheme, the cash value of those Lloyds Bonus Shares (at the offer price to be paid by Sabadell). In addition, if the Offer period extends beyond 25 June 2015 (whether or not the Offer is subsequently declared wholly unconditional or lapses), Lloyds intends to extend the compensation arrangements described above such that, in those circumstances, it will make arrangements to pay, to any investors who are entitled to receive Lloyds Bonus Shares under the terms of the scheme, the cash value of those bonus shares (again at the offer price to be paid by Sabadell). The Board of TSB has discussed these arrangements with Lloyds and is fully supportive of the arrangements.”

I'm not yet aware of how and when Lloyds will send any payment in lieu of the bonus shares.

My bolding above.

Yes, that's where I got my information from. However, from what I can see, the offer is not unconditional at the moment which is what it needs to be for the payout from Lloyds to be triggered.

Is there a timing issue to accepting the offer and ensuring the 5% bonus, or am I worrying about nothing?

Paul_1977

fifeken wrote: »

Yes. The one that has a section showing the Offer Document and all the other documentation regarding the sale.




The paperwork that says "Do you want to Sell - Yes or No".


I was hoping someone with knowledge of the way these things work could explain the sale process, and how it affects the 5% bonus.

Where does it say that?

fifeken

Paul_1977 wrote: »

Where does it say that?

On the paperwork I received from my shares sales dealing company.

pafpcg

"Is there a timing issue to accepting the offer and ensuring the 5% bonus, or am I worrying about nothing?"

I think it's the latter! From my reading of Section 17, Lloyds seem to be planning to pay (to all those entitled to the Bonus Shares) cash at the rate of £3.40 for every bonus share, either before or after June 25th or even if the deal fails to go through at all.

fifeken

pafpcg wrote: »

"Is there a timing issue to accepting the offer and ensuring the 5% bonus, or am I worrying about nothing?"

I think it's the latter! From my reading of Section 17, Lloyds seem to be planning to pay (to all those entitled to the Bonus Shares) cash at the rate of £3.40 for every bonus share, either before or after June 25th or even if the deal fails to go through at all.

Also discussed here:

https://forums.moneysavingexpert.com/discussion/5225660