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\u2019s largest lenders.<\/p>\n
The purchase of the Richard Branson-backed bank gives consumer and business lender CYBG greater scale, potential cost savings and access to the firm\u2019s presence on the high street.<\/p>\n
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\u2019s top-four lenders. The combined company will have around 80 billion pounds of assets.<\/p>\n
Through Friday\u2019s 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.<\/p>\n
It slightly sweetened its all-stock proposal earlier this month by offering Virgin Money shareholders more of the merged company.<\/p>\n
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.<\/p>\n
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.<\/p>\n