A legal challenge to the proposed merger of Lloyds TSB and HBOS has been launched today by the Merger Action Group (MAG).
The Competition Appeal Tribunal (CAT), launched today by MAG, is intended to look into whether the Government was right to waiver competition rules in order to allow the Lloyds TSB
HBOS merger to go ahead.
The legal action comes ahead of the final leg of voting over the merger as HBOS shareholders prepare to cast their votes on Friday. Commenting on the CAT, Merger Action Group spokesman, Malcolm Fraser, said:
"We are very confident of our legal case and we are greatly encouraged by the huge groundswell of support that our public campaign has attracted in the very short period of time since it was launched only a few days ago."
has dismissed the claims made by MAG, saying it has, "no merit and the deal remains in the best interests of shareholders and financial stability."
The Merger Action Group is comprised of account holders, current and former employees and business people, all of whom believe the merger will do more damage than good.
The group's main argument is that the Business Secretary Lord Mandelson used new legislation that was not yet in place to allow the merger to go ahead. It also believes that as a result of the Government's bail-out plan for the banks, HBOS could survive on its own and the group's future is not dependent on the merger.
If the Lloyds TSB takeover does get the go ahead on Friday, Lloyds Banking Group will be created. However, the brand names Halifax and Bank of Scotland will not be lost and will continue to operate on the high street.
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