Fortis raises Generale bid

FORTIS AG, part of the the Dutch-Belgian financial services group Fortis, is raising its bid for Generale de Banque, the Belgian bank, in an offer valued at 28,675 Belgian francs per Generale share.

The offer comprises Fortis AG's earlier seven-for-three share exchange, plus a BFr2,715 cash payment, and a "cash guarantee" of BFr1,350, to protect shareholders against a fall in Fortis AG's share price. A Fortis spokesman said the cash guarantee was "a kind of warrant".

The offer represents a premium of 7.2 per cent over the current value of the rival offer by the Dutch bank ABN Amro, the spokesman said. The new offer is almost 16 per cent above Fortis's original offer, made on 18 May.

The spokesman declined to comment on the "poison pill" share issue being considered yesterday evening by the Generale board, which, if approved, would involve Generale issuing a further 10 per cent of capital to Fortis.

ABN Amro said yesterday it was surprised that Generale's board was meeting to discuss the use of a poison pill.

"We were not informed about this meeting," said a spokesman. "If they are really discussing this, we can only be very surprised."