Murphy in HBOS talks

Published on Saturday 1 November 2008 14:08

SCOTTISH Secretary Jim Murphy is today having talks with a leading businessman about the possibility of a second bid for HBoS.

Mr Murphy has already had discussions with Jim Spowart, the founder of Intelligent Finance, on the issue.

Edinburgh-based HBoS is the subject of a proposed 12 billion merger with Lloyds TSB.

But it emerged that Mr Spowart contacted the Scottish Secretary earlier this week to discuss the possibility that contacts he has with merchant bankers in London could be willing to put together a rival bid.

Mr Murphy and Mr Spowart have had several discussions about a possible second bid for HBoS.

Today the Scottish Secretary said: "Jim and I will be having more talks today."

He added: "I have spoken to the Treasury and if there is a second serious bid then they (Treasury) would be happy to talk to them."

The possibility of a second deal emerged the day after the Government gave Lloyds TSB's planned merger with HBoS the green light after overruling competition concerns raised by the Office of Fair Trading.

Business Secretary Peter Mandelson said the public interest of "preserving the stability of the financial system" outweighed any potential anti-competitive effects.

Lord Mandelson said: "I am satisfied that on balance the public interest is best served by allowing this merger to proceed without a reference to the Competition Commission."

Mr Spowart has previously accused Prime Minister Gordon Brown and Chancellor Alistair Darling of trying to "railroad" the merger with Lloyds TSB through.

He said: "A merger with Lloyds TSB is not the best option.

"And with thousands of jobs in the balance I implore Mr Brown to think again."

A spokesman for Scottish First Minister Alex Salmond said today: "If any new bid or management team emerges for HBOS, the First Minister will approach that in exactly the same way he approached the Lloyds TSB bid, which is making the positive case for Scotland and making sure that those involved see the value of retaining jobs and decision making in Scotland.

"Any bid has to be judged against what is in the best interests of Scotland in terms of jobs, decision-making and competition."