Acquisition of UST Corp Complete
Royal Bank of Scotland Group PLC
12 January 2000
THE ROYAL BANK OF SCOTLAND GROUP plc ('ROYAL BANK GROUP') COMPLETES
ACQUISITION OF UST CORP. OF MASSACHUSETTS ('UST')
The Royal Bank Group's wholly owned subsidiary, Citizens Financial Group Inc.
('Citizens') has completed the acquisition of the entire issued share capital
of UST Corp of Boston, Massachusetts.
Completion of the acquisition, which was announced in June 1999 subject to UST
shareholder approval and US regulatory clearances, took place on schedule
following Commonwealth of Massachusetts approvals which were received on 6
January 2000. The purchase price of US$32 per share, paid in cash, values
UST at approximately US$1.4 billion (approximately £850 million).
Commenting on the transaction, Sir George Mathewson, Group Chief Executive of
Royal Bank Group, said: 'This acquisition, together with the acquisition of
the commercial banking business of State Street which was completed last
October, confirms Citizens' position as the second largest banking group in
New England and as the major competitor to the merged FleetBoston. It
completes the transformation of Citizens from a primarily retail to a retail
and commercial banking group and significantly extends Citizens' presence in
the important Greater Boston market. This transaction significantly increases
the value of Citizens to Royal Bank Group shareholders.'
The transaction is expected to be accretive to the Royal Bank Group in the
first full financial year after completion, ending on 30 September 2001, and
is anticipated to produce cost savings of $80 million pre-tax by the end of
that period.
For further information contact:
David Appleton
Head of Media Relations Tel: 0131-523-4414
NOTES TO EDITORS
UST is a US bank holding company which operates through 87 branches and nine
wholly owned subsidiaries located in Massachusetts, and at 30 September 1999
had US$6.3 billion (approximately £3.8 billion) in assets.
Since 1991 Citizens has completed 17 banking acquisitions in the US. During
that period it has increased its total assets from approximately US$3 billion
and less than 40 branches to approximately US $28 billion and more than 350
branches. In the year to 30 September 1999 it reported a profit before tax
(under UK GAAP) of £242 million, 13 per cent higher than the prior year,
adjusted for a one-off gain arising on the sale of Citizens' consumer credit
card portfolio of £33 million in 1998.
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