First Active deal moves forward

Royal Bank of Scotland's €887 million acquisition of First Active moved closer to completion yesterday after the Competition Authority said it would not seek to approve the deal.

The decision, which has been welcomed by First Active, removes an element of uncertainty from the transaction that could have led to its dissolution.

If the Competition Authority had asked the European Commission to give it jurisdiction on the matter before today, Royal Bank of Scotland's offer for First Active would have lapsed.

In a statement issued after the market closed yesterday afternoon, the Competition Authority said it had decided not to ask the Commission to refer the deal, "having given due consideration to the matter".

The authority's conclusion leaves First Active and Royal Bank of Scotland in a position to put the transaction before shareholders at meetings this afternoon. Presuming shareholder approval is achieved, the acquisition will then require sanction from both the European Commission and the High Court before becoming unconditional.

The High Court hearing is scheduled for the middle of next month, while the Commission is likely to issue its ruling within the next week.