Alliance & Leicester will become part of Abbey after agreeing to a £1.25bn deal from Banco Santander.
The approach from Santander was announced this morning and A&L shareholders have agreed to the deal.
Investors in A&L will receive one share in Santander for every three shares they hold in Alliance & Leicester which will still declare an interim dividend of 18p per share.
The deal is at a 44.6% premium to A&L’s closing price on Friday and will see Santander’s existing UK operations at Abbey combined with the firm.
Santander hopes the deal will allow Abbey to enhance the competitiveness of its products and services in the UK market.
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