Belgian-Dutch financial group Fortis won overwhelming initial shareholder approval yesterday to raise €13 billion to finance its part of a three-bank bid to buy ABN Amro.

Fortis, Royal Bank of Scotland and Spain's Santander have offered €71 billion, mostly in cash, for the Netherlands's largest bank in a bidding war that has featured legal and stakeholder battles.

Approval by Fortis shareholders of its proposed purchase of ABN Amro's Dutch operations and the rights issue would give the RBS-led consortium a boost at a time when the rival Barclays bid is suffering from the decline of its share price.

Barclays formally launched its mostly share bid of €65 billion yesterday in the biggest ever takeover battle.

ABN's management said it would hold a shareholder meeting on September 20th to discuss the competing offers. Its fate, however, will be determined by which bidder its shareholders choose before the offers expire in early October.

Analysts had expected Fortis to win approval even though its shares have fallen almost 20 per cent since it announced that it would contribute €24 billion to the deal, which it would finance with one of Europe's largest rights issues.

Fortis shares, about 1 per cent weaker in early trading, slipped lower after the vote and were down 1.4 per cent at €28.04 in early afternoon trading. ABN Amro shares were up 1.3 per cent at €35.49. "Fortis shares are down, because there will probably be a dilution of profit due to the share issue," said Theodoor Gilissen analyst Gert-Jaap Kraan.

Fortis wants shareholders at its two meetings to back its vision of becoming the biggest bank in the Benelux.

"Joining forces with ABN has lots of advantages, but of course it has its price. The €24 billion that Fortis is putting on the table is of course a very high amount of money. Quality has its price," Fortis chairman Maurice Lippens told shareholders.

Barclays declined to comment on the vote but said it continued to believe its offer would ultimately deliver more value with low risk to ABN shareholders.

It has said it would keep ABN Amro largely intact and make Amsterdam the combined group's headquarters. ABN backed Barclays' original offer in April but withdrew its formal recommendation last week.

In an unusual joint statement from ABN and the consortium yesterday, both sides said they would maintain constructive dialogue. But ABN has made clearthat it prefers the Barclays offer.

Barclays' offer period will run from August 7th until October 4th, Barclays said in a statement published in a Dutch newspaper yesterday. The RBS consortium's offer period started on July 23rd and runs until October 5th.

Either bid will be declared unconditional if it gets more than 80 per cent of shares tendered.