Lloyds TSB merger with HBOS faces legal challenge

Lloyds TSB (LON:LLOY) merger with Halifax Bank of Scotland (LON:HBOS) will come under a legal challenge today when the Competition Appeal Tribunal decides if the government made the right decision to bypass competition concerns allowing HBOS to be rescued, the hearing will begin at midday today (December 8).

The Merger Action Group (MAG) are the action group behind the challenge and consists of shareholders, bank customers and businessmen, however, HBOS have said they are confident that the merger will be approved.

MAG had said that if the merger between Lloyds TSB and HBOS was to go ahead it would be bad for Scotland’s economy, and that Lord Mandelson’s decision to allow the merger to go ahead was based on new legislation that was not in place at the time of the announcement.

HBOS shareholders will be voting on the merger on December 12, the legal challenge by MAG was fast tracked to make sure there would be a ruling before then.