An SNP MEP has launched a last-ditch bid to persuade the European Commission to intervene in the takeover of HBOS by Lloyds TSB by claiming that the UK government failed to offer a level playing field to alternative bidders.

Alyn Smith has written to the European Competition Commissioner, Neelie Kroes, after Chancellor Alistair Darling said last week that no other bidder “would have automatic right of access to the recapitalisation scheme”.

Smith claims his comments confirmed that the favoured option of the UK government is a takeover of HBOS by Lloyds TSB to the detriment of all other options, including HBOS remaining independent.

“There are plenty of concerns over this deal and the tactics being used by the UK Government to see it goes ahead,” he said. “I believe the most significant is the specific operation of the recapitalisation available to the merged bank clearly favouring one outcome for HBOS while other banks are allowed to maintain their independence.”

At a general meeting last week, 96% of Lloyds TSB shareholders backed plans for the takeover and a similar level of support is expected at HBOS’s own meeting on December 12.

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