Clydesdale and Yorkshire Banks’ parent group, CYBG, has put forward a preliminary bid to take over Virgin Money, valuing Sir Richard Branson’s lender at £1.6bn.
CYBG says the proposal would give Virgin Money shareholders “the opportunity to participate in the continuing progress of the combined group.”
Under the terms of the proposal, CYBG would acquire the entire share capital of Virgin Money at a ratio of 1.13 new CYBG shares for each Virgin Money share.
Virgin Money shareholders would own approximately 36.5 per cent of the combined group.
CYBG says it “recognises the strength and appeal of the Virgin Money brand” and would ensure that the name “would play a significant role in the combined group”.
It says that a merger “would create the UK’s leading challenger bank offering both personal and SME customers a genuine alternative to the large incumbent banks.”
“The combination would provide a powerful full-service banking offer, including leading digital and mobile banking services, for 6 million personal and business customers, bringing together the complementary strengths of CYBG and Virgin Money.
In response, a statement from Virgin Money says it is reviewing the preliminary bid, but it cautions:
“There can be no certainty either that an offer will be made nor as to the terms of any offer, if made.
“Accordingly, shareholders are advised to take no action in relation to this proposal.
“A further announcement will be made in due course.”
