As yet there is no confirmation on the financial details of the deal, but rumour has it that the bid for the 318 RBS-owned old Williams & Glyn branches is in the region of between £1.5 billion and £1.8 billion.
Following the government bail-out of RBS last year, the 83% tax-payer owned bank has been forced to sell off various assets to satisfy European concerns around competition. It has a deadline of 2013 to complete these transactions.
If the uncontested Santander bid is successful the Spanish owned bank, which already owns Abbey, Alliance & Leicester and the savings arm of Bradford & Bingley, will represent 14% of the UK mortgage market and 10% of retail savings.
Sources close to the deal said the Santander bid was driven by the desire to beef up the bank’s market share in the SME sector, which is currently underweight at around 6%.
Buying the Williams & Glyn branch network would significantly boost Santander’s SME presence.
A statement from Santander said: “Currently, it is not possible to say when the tender process will conclude,” but it is likely that if the bid is successful, realistically integration of the two businesses will happen in 2011.
