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Jul 23 2007 12:00am EDT
Barclays Bank's Catch-22
How's this for a conundrum? If Barclays Bank wins ABN Amro, then its shares, like those of most successful acquirers, are likely to drop.
On the other hand, if Barclays fails to win ABN Amro, then Barclays itself becomes a takeover target and its shares are likely to rise.
So people who think Barclays is going to win ABN Amro should sell the shares, which will depress the value of its part-stock offer and make it more likely to lose ABN Amro.
That, in turn, will make it a takeover candidate and cause its shares to rise.
But that will help it to win ABN Amro after all, which means the shares will drop...
Read Felix Salmon's full Market Movers blog post on this subject here.
Laura Rich is a co-founder of Recessionwire, which provides news, advice, perspective and humor about the recession and the recovery.
