2 bidders fighting for Amro

AMSTERDAM, Netherlands - One of the largest takeovers in corporate history escalated into a bidding war yesterday as a group led by Royal Bank of Scotland said it planned a bid worth almost $100 billion for ABN Amro that tops a Barclays' offer by more than 10 percent.

Shareholders immediately pressured ABN to commit to accepting the highest bid, ahead of the Dutch bank's annual shareholders' meeting today, and analysts said the key battleground is LaSalle Bank in Chicago. One analyst called LaSalle the "crown jewel" of ABN's international operations.

Royal Bank of Scotland P.L.C., Spain's Banco Santander Central Hispano SA and Belgian-Dutch bank Fortis NV said they would offer about 39 euros, or $52.95, per share for ABN Amro Holding NV - 70 percent in cash and 30 percent in Royal Bank shares - valuing ABN Amro at roughly $98.1 billion.

Royal Bank is the parent of Citizens Financial Group, which owns Citizens Bank of Pennsylvania. The Pennsylvania bank is based jointly in Philadelphia and Pittsburgh. Banco Santander owns about 25 percent of the shares in Sovereign Bancorp Inc. of Wyomissing.

Yesterday's offer compares with Barclays P.L.C.'s all-share offer of 36.25 euros announced Monday, which was endorsed by ABN's management. ABN shares are up more than 35 percent since it entered talks with Barclays last month.

ABN shares rose 3.5 percent yesterday to close in between the Barclays' offer price and the proposed rival bid by RBS. That means investors have serious doubts about who will win the fight to buy ABN, the Netherlands' largest retail bank.

The uncertainty centers on whether ABN Amro's surprise move Monday to sell LaSalle Bank Corp. to Bank of America Corp. for $21 billion, as part of its deal with Barclays, can be undone.

"The crown jewel is LaSalle, which both BofA and RBS want badly, but for different reasons," said Bob Graves, cochairman of the global banking practice at Chicago law firm Jones Day.

With its dominant position in Chicago and parts of the Midwest, Graves said, LaSalle would "fill the one remaining hole in BofA's national coverage."

"For RBS, it's more of a stepping stone" to give its U.S. operations critical mass, he said.

RBS is the largest foreign bank in the United States, via Citizens Financial Group, which is strongest in the U.S. Northeast.