Sabadell in line for £450 million IT sweetener in TSB takeover
12 March 2015 | 6791 views | 0
Banco Sabadell stands to benefit from a £450 million 'IT dowry' bequeathed by Lloyds Banking Group if its proposed £1.7 billion takeover of TSB is approved.
As part of its IPO of 25% of TSB last year, Lloyds included a provision to pay up to £450m of integration costs in the event TSB decided to change its technology platform or was taken over.
The payment, which was approved by the European Commission and HM Treasury, is intended to cover the costs Lloyds could have spent building a new IT platform when it carved TSB out of its own business.
Lloyds instead opted to provide TSB with a carbon copy of its own technology platform.
TSB says it is minded to accept Sabadell's offer of 340 pence a share, noting the Spanish bank's track record of "successful business and IT integrations".