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Santander makes bid for RBS unit Santander makes bid for RBS unit
(40 minutes later)
The European Commission has forced RBS to sell the unitThe European Commission has forced RBS to sell the unit
Spanish bank Santander has submitted an offer to buy Royal Bank of Scotland's (RBS) Williams & Glyn's subsidiary.Spanish bank Santander has submitted an offer to buy Royal Bank of Scotland's (RBS) Williams & Glyn's subsidiary.
RBS is selling the unit and its 318 branches after the European Commission ruled last year that it must dispose of the business as a condition of the bank being bailed out by the UK government.RBS is selling the unit and its 318 branches after the European Commission ruled last year that it must dispose of the business as a condition of the bank being bailed out by the UK government.
Santander said it had joined the tender process for the sale, but it was not sure when the process would end.Santander said it had joined the tender process for the sale, but it was not sure when the process would end.
It is understood that Santander has offered considerably less than £2bn. Virgin Money also confirmed it is interested in the branches.
Santander is the only bidder for the branches, but that does not mean Santander will inevitably end up as their owner, BBC business editor Robert Peston said. Santander is understood to have offered considerably less than £2bn.
"There is a pretty high probability that the board of RBS will conclude that Santander is not offering enough and will therefore withdraw the branches from sale, in the hope that market conditions for the auction of such assets improve in a year or two's time," he said. "There is a pretty high probability that the board of RBS will conclude that Santander is not offering enough and will therefore withdraw the branches from sale, in the hope that market conditions for the auction of such assets improve in a year or two's time," BBC business editor Robert Peston said.
Under the agreement RBS reached with the European Commission on the disposal of certain of its businesses, RBS has another three and half years to complete the sale of the branches.Under the agreement RBS reached with the European Commission on the disposal of certain of its businesses, RBS has another three and half years to complete the sale of the branches.
'Sale still open''Sale still open'
RBS said it was "seriously reviewing" Santander's offer, but added that the tender process remained open to other interested parties.RBS said it was "seriously reviewing" Santander's offer, but added that the tender process remained open to other interested parties.
"This remains a competitive process and we will continue to do what is right for our shareholders in disposing of these assets," it said in a statement."This remains a competitive process and we will continue to do what is right for our shareholders in disposing of these assets," it said in a statement.
A number of other banks have been named as potential bidders, including National Australia Bank and US private equity group Blackrock, but reports have said they have dropped out of the running.A number of other banks have been named as potential bidders, including National Australia Bank and US private equity group Blackrock, but reports have said they have dropped out of the running.
Virgin Media has declined to confirm it has ended its bid interest.
"We are looking at market opportunities as and when they arise," a Virgin Media spokesman told the BBC.
Santander already has a substantial presence on the UK High Street having bought Abbey National, Alliance & Leicester and Bradford & Bingley in recent years.Santander already has a substantial presence on the UK High Street having bought Abbey National, Alliance & Leicester and Bradford & Bingley in recent years.