LONDON: ABN Amro agreed Monday to be acquired by Barclays of Britain for \67 billion (nearly $91 billion), creating one of the worlds largest banks in a carefully constructed deal that reduces, but does not eliminate, the chance of another suitor coming in with a higher bid to buy and break up the bank.

ABN Amro, the largest Dutch bank, said it had arranged to sell LaSalle Bank, its attractive American business, to Bank of America for $21 billion in cash. LaSalles appeal had drawn the Royal Bank of Scotland Group and two other European financial companies to prepare a counteroffer for ABN Amro.

In fact, the Royal Bank of Scotland and its partners, Banco Santander Central Hispano and Fortis of Belgium, were scheduled to meet with ABN Amro executives in Amsterdam on Monday. The meeting was canceled after the European bidders learned about the LaSalle agreement, but they have still requested information about the deal, and analysts do not rule out a rival bid.

The combination of ABN Amro and Barclays, which has increased investors expectations of other cross-border mergers, would create one of the worlds largest banks by total assets, about $3.1 trillion, even after LaSalle is sold, according to Bloomberg data. It will have operations in a wide geographical area, including Brazil and South Africa, with 217,000 employees and 47 million customers.

Barclays agreed to pay 3.225 of its shares for each ABN Amro share, an offer worth \36.25 each. That is 33 percent above ABN Amros share price on March 16, the day before the two banks said they were in takeover talks.

Barclays, which traces its roots back 300 years to the banker James Barclay, agreed to locate the combined banks headquarters in Amsterdam, rather than London. John Varley, the Barclays chief executive who will run the merged bank, will move there from London. The holding company of the new group will be called Barclays.

The banks said their combination would save \3.5 billion a year ($4.75 billion) by 2010, including the elimination of 23,600 jobs, or 10 percent of their current work forces.

As ABN Amro and Barclays executives were explaining the sealed agreement to analysts and journalists at meetings at Barclays headquarters here, the Royal Bank of Scotland and its partners told ABN Amro that it wanted information about the circumstances in which the LaSalle sale to Bank of America could be terminated.

For the group to make a worthwhile counteroffer at this late stage, LaSalle would still have to be part of the ABN group.

A London-based activist fund, the Childrens Investment Fund, which set takeover talks in motion with its demands early this year to either put ABN Amro up for sale or break it up, expressed its own misgivings on Monday about the LaSalle sale.

“We are concerned the pre-agreed sale of LaSalle Bank unfairly hinders the Royal Bank of Scotland consortium,” the fund, which owns less than 3 percent of ABN Amro, said in a statement. It asked the Dutch company to fully disclose all details of the LaSalle sale.

Bank of America is eligible for a $200 million breakup fee if the LaSalle sale is called off “under certain limited circumstances,” ABN Amro and Barclays said, declining to give further details.

In Amsterdam on Monday, shares of ABN Amro fell 1.43 percent to \35.77, indicating stockholders skepticism about getting a higher offer for their shares. Barclays dropped 2.27 percent in London, to 7.33.

ABN Amros chief executive, Rijkman Groenink, emphasized that Barclays was his preferred partner and that he did not see any financial logic in a split-up of the bank. But he said he was willing to listen to what the Royal Bank of Scotland and its partners had to offer.

“The Barclays combination is the preferred option for us,” Groenink said. “It has always been the ambition of ABN to build rather than break.”

Even though the sale of LaSalle Bank, which would turn Bank of America into the largest in Chicago, allowed Barclays to offer more to ABN Amro shareholders, the consortium led by the Royal Bank of Scotland would still be able to offer a higher price for ABN Amro, said Euan Stirling, an investment director at Standard Life Investments in London.

It could afford to make a higher offer because it can essentially split the acquisition bill three ways and generate greater cost savings, analysts have said. After such an acquisition, the consortium would break up ABN, with each member owning a different part of ABNs business.

SAN FRANCISCO—Among the companies whose shares are expected to see active trading in Tuesday’s session are Archer Daniels Midland Co., Procter & Gamble Co., and Circuit City Stores Inc.

Archer Daniels Midland Co. () is expected to report third-quarter earnings of 62 cents a share, according to a survey of analysts by Thomson Financial.

Automatic Data Processing Inc. () is expected to post earnings of 63 cents a share for the third quarter.

Liz Claiborne Inc. () is expected to report first-quarter earnings of 60 cents a share.

Marathon Oil Corp. () is expected to post earnings of $1.93 a share for the first quarter.

MetLife Inc. () is expected to report first-quarter earnings of $1.28 a share.

Procter & Gamble () is expected to post earnings of 74 cents a share for the third quarter.

Qwest Communications International Inc. () is expected to report first-quarter earnings of 9 cents a share.

RR Donnelley & Sons Co. () is expected to post earnings of 59 cents a share for the first quarter.

Sirius Satellite Radio Inc. () is expected to report a first-quarter loss of 11 cents a share.

Yum Brands Inc. () is expected to post earnings of 64 cents a share for the first quarter.

After Monday’s closing bell, shares of Circuit City () fell 10 percent after the company forecast a loss from continuing operations for the first quarter of fiscal 2008 and withdrew its previously issued outlook for the first half of the full-year 2008 period.

Watch List

AmeriCredit Corp. () reported fiscal third-quarter net earnings of $103.7 million, or 80 cents a share per share, up 19.6 percent from $86.7 million, or 60 cents a share, in the same period last year. The Fort Worth, Texas-based auto finance company said third-quarter revenue rose to $615.3 million from $455.1 million in the same quarter last year.

Atheros Communications Inc. () reported first-quarter net earnings of $7.6 million, or 13 cents a share, up 11.5 percent from $6.81 million, or 13 cents a share, in the year-ago period. The Santa Clara, Calif.-based provider of semiconductor systems for wireless communications products reported revenue for the three months ended March 31 of $95.5 million, up from $61.1 million last year.

AudioCodes Ltd.’s () swung to a first-quarter loss of $2.38 million, or 6 cents a share, from net income of $2.28 million, or 5 cents a share, a year earlier, as expenses rose 36 percent. The Israeli company’s revenue increased 17 percent to $36.5 million from $31.3 million in the year-ago period. Expenses grew to $23.4 million from $17.2 million.

Axis Capital Holdings () reported first-quarter net earnings of $236.8 million, up from $204.8 million in the same quarter last year. Net income available to common shareholders rose to $227.6 million, or $1.37 a share, from $195.2 million, or $1.19 a share, in the year-ago period. The Bermuda based insurer and reinsurer said revenue in the three months ended March 31 rose to $812.8 million from $716.9 million last year, while net written premiums rose 15 percent to $1.14 billion.

Cabot Oil & Gas Corp. () reported a narrower first-quarter profit of $48.5 million, or 50 cents a share, compared with $53.2 million, or 55 cents, a year ago. For the three months ended March 31, Cabot said sales fell to $191.5 million, from $214.7 million. The company said it was affected by lower natural gas prices and less oil production.

Home-builder Centex Corp. () said it swung to a quarterly loss and booked impairment charges on a slower housing market.

Comcast Corp. () () said its Comcast Interactive Media has entered into a multi-year strategic partnership with Yahoo Inc. () for online display and video advertising services on Comcast.net. Financial terms weren’t disclosed.

Covance Inc. () reported first-quarter net earnings of $38.9 million, or 60 cents a share, up 16.5 percent from $33.4 million, or 52 cents a share, during the year-ago period. The Princeton, N.J.-based drug development service provider posted revenue for the three months ended March 31 of $376.9 million, up 13 percent from $333.6 million last year.

Enzon Pharmaceuticals Inc. () received approval from the U.S. Food and Drug Administration for its investigational new drug application. The Bridgewater, N.J., biopharmaceutical company said the application was for PEG-SN38, a PEGylated form of the active metabolite of the cancer drug Camptosar. Enzon plans to begin a phase I trial investigating the drug in patients with solid tumors or lymphoma in the first half of this year, the company said.

EOG Resources Inc. () reported first-quarter net earnings of $217.7 million, down 49 percent from $426.7 million in the same quarter last year. The Houston-based oil and gas company said net income available to common shareholders came in at $216.8 million, or 88 cents a share, down from $424.8 million, or $1.73 a share, a year ago. Revenue in the three months ended March 31 fell to $875.2 million from $1.08 billion.

General Dynamics Land Systems, a unit of General Dynamics Corp. () , said it has received a work order for $244.5 million of a $490 million contract awarded to Force Protection Inc. () on April 24.

General Growth Properties Inc. () reported first-quarter net earnings of $230.2 million, or 94 cents a share, up from $23 million, or 10 cents a share, in the year-ago period. The reduction of net deferred tax liabilities increased earnings, net of minority interest, by about $245 million, or $1 a share, the company said. The Chicago-based real estate investment trust said revenue in three months ended March 31 fell to $728.8 million from $828.6 million in the comparable period a year ago.

Genworth Financial () said that first-quarter net income came in at $324 million, down 3 percent from a year earlier when the insurer made $334 million. Net income per common share was 71 cents vs. 70 cents a year ago. Genworth affirmed its 2007 outlook for net operating income of $3.15 to $3.25 per share.

Hanover Financial Group Inc.’s () first-quarter net income grew about 57 percent to $63.6 million, or $1.22 a share, from a year-earlier profit of $40.5 million, or 75 cents a share. The Worcester, Mass., insurance and financial services holding company’s income from continuing operations increased 6 percent to $63.8 million, or $1.23 a share, from $60 million, or $1.12 a share.

Hercules Inc. () said net income for the first quarter rose to $73.5 million, or 64 cents a share, from $14.7 million, or 13 cents a share, in the year-ago quarter. Earnings in the most recent quarter included 41 cents a share from resolving IRS tax audit items. Sales fell nearly 5 percent to $502.3 million, the chemicals company said.

Labor Ready Inc. () acquired construction trades staffing provider Skilled Services Corp. for $25.5 million. Tacoma, Wash., provider of temporary employees Labor Ready also boosted its second-quarter revenue outlook to $342 million to $345 million and reaffirmed its earnings forecast of 33 cents to 35 cents a share. Labor Ready had previously forecast second-quarter revenue of $337 million to $340 million.

Manitowoc Co. () reported first-quarter net earnings of $64.1 million, or $1.01 a share, up from $29.7 million, or 48 cents a share, during the year-ago period. The Manitowoc, Wis.-based provider of lifting equipment for the global construction industry posted revenue for the three months ended March 31 of $862.1 million vs. $633 million last year.

Standard & Poor’s said it’s changing the makeup of the S&P SmallCap 600 index. Matrix Service Corp. () will replace John H. Harland Co. () . S&P also said that Ansoft Corp. () will replace Hydril Co. () in the index.

Meadowbrook Insurance Group Inc. () reported first-quarter net earnings of $6.92 million, or 23 cents a share, up 23 percent from $5.62 million, or 19 cents a share, during the year-ago period. The Southfield, Mich.-based insurer posted total revenue of $82.9 million vs. $79.6 million. Net written premiums were $72 million compared with $69.4 million, a year ago.

MedImmune Inc. () reported first-quarter net earnings of $160 million, or 66 cents a share, up from $47 million, or 18 cents a share, in the year-ago period. Excluding share-based compensation, the company’s net earnings for the 2007 first quarter were $166 million, or 69 cents a share, compared to $59 million, or 23 cents a share, in the 2006 first quarter The Gaithersburg, Md.-based biotechnology company said revenue in the three months ended March 31 came in at $574.8 million, up from $498 million last year. MedImmune agreed last week to be acquired by AstraZeneca () for $15.6 billion.

Noble Corp. () elected Chief Executive Officer and President Mark Jackson chairman.

Odyssey Healthcare Inc.’s () first-quarter net income fell to $3.66 million, or 11 cents a share, from $5.84 million, or 17 cents a share, a year earlier. Income from continuing operations was 12 cents a share. The Dallas hospice care company’s revenue improved slightly to $103.4 million from $102.6 million in the year-ago period.

Pfizer Inc. () said a Canadian appeals court has reversed a lower court ruling that would have allowed Novopharm to launch a generic version of Pfizer’s pain reliever Celebrex. The court prohibited regulatory approval of the generic manufacturer’s product in Canada until Celebrex’s compound patent expires in November 2014, Pfizer said.

Post Properties Inc.’s () first-quarter income jumped to $24.5 million, or 51 cents a share, from a year-earlier profit of $4.8 million, or 7 cents a share The Atlanta real estate investment trust’s results for the recent period included a net gain of $16.7 million on the sale of an apartment community. Revenue from continuing operations increased to $77.5 million from $72.2 million. Post Properties’ funds from operations available to shareholders rose to $20.7 million, or 46 cents a share, from $19.9 million, or 46 cents a share.

Principal Financial Group () said that first-quarter net income came in at $265.3 million, down 10 percent from a year earlier when the 401-k specialist made $293.9 million. Net income available to common shareholders was $257.1 million, or 95 cents a share, the company added. Operating earnings were $236.8 million, or 87 cents a share, little changed from a year ago, Principal said.

Rent-A-Center Inc.’s () first-quarter per-share earnings fell 63 percebt to $15.1 million, or 21 cents a share, from $40.3 million, or 57 cents a share, a year earlier, as the company recorded $51.3 million in litigation expense. Excluding litigation charges, the latest quarter’s earnings were 66 cents a share in the latest quarter. The Plano, Texas, rent-to-own company’s revenue rose 24 percent to $755.3 million from $607 million in the year-ago period.

Skechers USA Inc. () said a U.S. district court has denied a motion by Asics Corp. for a preliminary injunction against Skechers. The U.S. District Court for the Central District of California found that there are “substantial” differences between Asics’ trademark and Skechers’ stripe designs, Manhattan Beach, Calif.-based Skechers said. In an opinion dated April 25, the court said that Asics had not shown that it’s likely to succeed in its trademark infringement case against Skechers. The opinion said that “the designs are quite different and in the marketplace the shoes appear highly dissimilar,” Skechers said.

Vertex Pharmaceuticals Inc. () said its first-quarter loss widened on higher research and development costs. Vertex posted a net loss of $80.7 million, or 64 cents a share, compared with a loss of $50.1 million, or 47 cents a share, in the same quarter last year. Revenue at the Cambridge, Mass.-based biotechnology company rose to $68.8 million from $39.1 million.

Vulcan Materials Co.’s () first-quarter net income rose 34 percent to $88.9 million, or 91 cents a share, from $70.1 million, or 68 cents a share, a year earlier. Real-estate gains totaled 26 cents a share in the latest quarter. The Birmingham, Ala., industrial materials and commodities company’s revenue fell to $687.2 million from $708.7 million.

Wright Medical Group Inc.’s (WMGI) first-quarter net income rose to $3.19 million, or 9 cents a share, from $2.3 million, or 7 cents a share, a year earlier, thanks in part to stronger international sales. Excluding stock-based compensation, earnings were 19 cents share for the quarter. The Arlington, Tenn., medical implant maker’s net sales grew 9.3 percent to $94.3 million from $86.3 million.

The heads of the New York Stock Exchange and the Tokyo Stock Exchange have met to discuss a strategic alliance between the two bourses, which analysts say could help the Japanese exchange regain investor confidence after an embarrassing series of system failures.

The NYSE Group chief executive, John Thain, and the president of the Tokyo Stock Exchange, Taizo Nishimuro, met in Paris over the weekend and have another meeting scheduled for Wednesday in New York. At the World Economic Forum in Davos, Switzerland, last week, both men confirmed that negotiations were nearing completion.

Analysts say any agreement is likely to be limited in scope, perhaps involving technology exchanges and joint listings. Some speculate that the NYSE might take a token equity stake in the privately held Tokyo bourse, but a spokesman in Tokyo, Toru Onoda, said this was unlikely until after the bourse went public in 2009.

For the Tokyo exchange, an alliance with a top global exchange would be a move toward restoring its reputation, damaged by a string of computer-related system meltdowns that paralyzed trading and helped trigger massive losses.

Those failures, in late 2005 and early last year, hurt investors’ faith in the Tokyo exchange, Asia’s largest and most sophisticated equity market and the world’s second-largest, after New York.

“The TSE is still trying to put its house back in order and regain investor confidence,” said Neil Katkov, a Tokyo-based analyst at Celent Communications, referring to the Tokyo Stock Exchange. “A tie-up with a major foreign exchange makes them look competitive again.”

For the New York Stock Exchange, an alliance allows it to tie up with Asia’s largest market, with a capitalization of $4.6 trillion about a third of New York’s. The alliance will hold little risk for New York, said analysts, as it will likely be a limited tie-up with no exchange of capital. That means few investors will blame New York if Tokyo’s problems continue, analysts said.

“Another disaster at the Tokyo Stock Exchange won’t make the New York Stock Exchange look bad,” Katkov said.

The problems at the Tokyo exchange began in two incidents in November 2005, when computer failures briefly shut the exchange and later caused a $350 million loss by the Mizuho Securities brokerage. The exchange’s president resigned a month later to take responsibility, but the computer system crashed again for an entire day in January after prosecutors raided Livedoor, a once high-flying Internet firm.

Despite plans to improve technical reliability and performance at the exchange, some foreign and even Japanese funds have already pulled up stakes and moved to other Asian markets like Singapore, where trading is faster and easier.

At same time, analysts said Tokyo’s stock market remains enormously popular as a place to invest. Foreign investors have been net buyers in recent years, drawn by rebounding stock and asset prices as Japan’s economy finally recovers from a long slump in the 1990s.

On Tuesday, the Nikkei 225 closed at 17,490.19, near a six-year high.

Onoda, the Tokyo exchange spokesman, said it could not afford to get left behind by the trend toward alliances and mergers among major global stock markets. He said it has been in similar talks with the London Stock Exchange.