Virgin Money to be bought for $2.3 billion
CYBG agreed to buy Virgin Money Holdings UK Plc for about 1.7 billion pounds ($2.3 billion) in an all-stock transaction, creating a bank with about six million customers to challenge Britain’s largest lenders.
The purchase of the Richard Branson-backed bank gives consumer and business lender CYBG greater scale, potential cost savings and access to the firm’s presence on the high street.
The deal adds to a number of transactions among a handful of smaller banks in the UK as they seek to raise funds and steal business from Britain’s top-four lenders. The combined company will have around 80 billion pounds of assets.
Through Friday’s close, Virgin Money shares gained about 14 percent since CYBG, formerly the British division of National Australia Bank Ltd., initially made an offer in May.
It slightly sweetened its all-stock proposal earlier this month by offering Virgin Money shareholders more of the merged company.
Virgin Money shareholders would receive 1.2125 new CYBG shares under the offer, according to a statement Monday. Owners of the Branson company will own about 38% of the combined group.
CYBG Chairman Jim Pettigrew, Chief Executive Officer David Duffy and CFO Ian Smith will retain their current positions in the new group, according to the statement. Jayne-Anne Gadhia, CEO of Virgin Money, will stay on as an adviser for an unspecified time.
Read: Virgin Money South Africa launches online buying platform
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