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You can find the current article at its original source at https://www.theguardian.com/business/2018/jun/04/virgin-money-offer-clydesdale-bank-uk
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| Virgin Money receives improved offer from Clydesdale Bank owner | Virgin Money receives improved offer from Clydesdale Bank owner |
| (about 1 hour later) | |
| The owner of Clydesdale and Yorkshire banks has improved its £1.6bn offer for Virgin Money in an attempt to create Britain’s sixth-largest bank, with 6 million customers. | |
| Clydesdale and Yorkshire Bank Group (CYBG) is offering Virgin shareholders a larger stake in the combined group – 38% compared with 36.5% under the initial offer – prompting Virgin to enter into negotiations with its rival. CYBG is offering to exchange 1.2125 new shares for each Virgin Money share, up from 1.1297 shares. | Clydesdale and Yorkshire Bank Group (CYBG) is offering Virgin shareholders a larger stake in the combined group – 38% compared with 36.5% under the initial offer – prompting Virgin to enter into negotiations with its rival. CYBG is offering to exchange 1.2125 new shares for each Virgin Money share, up from 1.1297 shares. |
| The revised offer values Virgin Money at 359p a share. CYBG’s share price had fallen in recent weeks but rose 1.4% to 296.4p on Monday morning. | |
| Virgin Money said it had begun talks with CYBG because of the improvement in the terms of the proposal, and the “substantial synergy potential” and growth opportunities. | Virgin Money said it had begun talks with CYBG because of the improvement in the terms of the proposal, and the “substantial synergy potential” and growth opportunities. |
| The boards of both banks said the proposed deal would create the UK’s first true national competitor to the large banks, with 6 million personal and business customers. They believe it would bring significant savings by removing overlap between the two firms, optimising IT spend and “rationalising” their operations. | The boards of both banks said the proposed deal would create the UK’s first true national competitor to the large banks, with 6 million personal and business customers. They believe it would bring significant savings by removing overlap between the two firms, optimising IT spend and “rationalising” their operations. |
| The Virgin Money founder, Richard Branson, who owns a 35% stake, could bag a large profit on the sale, seven years after he led a controversial £747m buyout of Northern Rock – later rebranded Virgin – following its rescue by the taxpayer. | The Virgin Money founder, Richard Branson, who owns a 35% stake, could bag a large profit on the sale, seven years after he led a controversial £747m buyout of Northern Rock – later rebranded Virgin – following its rescue by the taxpayer. |
| Share Capital analyst Gary Greenwood said he thought the offer was “somewhat lightweight”, adding that it should be thought of as a merger rather than a takeover. | Share Capital analyst Gary Greenwood said he thought the offer was “somewhat lightweight”, adding that it should be thought of as a merger rather than a takeover. |
| Given that the two boards were in discussions, Greenwood said “there is goodwill on both sides of the fence for a deal to proceed”, and he expected the offer to be formalised ahead of the new deadline of 18 June. | |
| “Whether Virgin Money (and its shareholders) will press for a further sweetener remains to be seen,” he said. “The lack of an upfront cash incentive is notable and may be a source of further debate.” | “Whether Virgin Money (and its shareholders) will press for a further sweetener remains to be seen,” he said. “The lack of an upfront cash incentive is notable and may be a source of further debate.” |
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