ABN says working with RBS, talks continue

AMSTERDAM, May 4 (Reuters) Dutch bank ABN AMRO said on Friday it was working constructively with Royal Bank of Scotland (RBS) over its possible bid and remained open to other bidders despite recommending a merger with Barclays.

The proposed billion merger was thrown into doubt on Thursday when a Dutch court told the bank to freeze its billion sale of U.S. unit LaSalle to Bank of America, making it easier for RBS and two partners to bid for the whole of the Netherlands' biggest bank.

The consortium of RBS, Santander and Fortis has indicated readiness to pay as much as 72 billion euros ( billion), and sources familiar with the matter said the RBS-led group was still trying to secure agreement from ABN.

The three banks plan to counterbid for LaSalle under a ''go shop'' sale period that runs until midnight on Sunday in New York, but the offer will be conditional on them also buying the rest of ABN, sources familiar with the matter said.

Barclays said it would push ahead despite the court ruling and ABN spokesman Jochem van de Laarschot said the bank still recommended that offer -- which ABN Chief Executive has said would keep the bank intact rather than breaking it up.

''In the meantime, we are working with the consortium in a constructive and collaborative manner,'' he said, but declined to comment on whether ABN's management was meeting with the RBS group on Friday.

RBS also declined to comment after the Wall Street Journal reported the RBS group would meet with ABN on Friday.

ABN STUDYING RULING Any deal to buy ABN would be the biggest banking merger ever.

With growing pressure on Groenink from some shareholders to resign after Thursday's court decision, Van de Laarschot said: ''A change in management has not been considered.'' Asked whether ABN would appeal against Thursday's court decision, the spokesman said only that the bank was studying the implications of the court ruling.

The court's ruling came after Dutch investor group VEB, with the support of shareholders representing up to 20 percent of ABN's shares, took its case to the Dutch commercial court in Amsterdam on Saturday, asking for an injunction against the LaSalle sale and an investigation.

Investors, hedge funds and the RBS group had demanded that ABN put the LaSalle deal to a shareholder vote since it made it difficult for others to counterbid for the whole of ABN.

ABN, which has until June 14 to appeal, had argued the sale of LaSalle was not a ''major transaction'' requiring approval, as it amounted to less than a third of the bank's total value.

The notice period needed for a shareholders' meeting at ABN is a minimum of 15 days, meaning the sale could now be on hold for as least that long.

Barclays wants to increase its exposure to fast growing markets in Brazil and Asia while the consortium would seek to beef up operations in Europe, a sector ripe for consolidation.

REUTERS PV VV1457