A consortium led by Richard Branson's Virgin Group is shaping up to be the likeliest candidate to rescue Northern Rock from its current crisis, it emerged on Monday.
In a statement published this week, Northern Rock announced that:
"Following receipt of indicative expressions of interest covering a range of options in respect of its business, the Company and its advisors have engaged in discussions with a limited number of selected interested parties to clarify their proposals. As a result, and following discussions with the Tripartite Authorities (the Bank of England, HM Treasury and the Financial Services Authority), the Board has concluded that it wishes to take forward discussions on an accelerated basis with a consortium comprising Virgin Group, WL Ross & Co, Toscafund Asset Management LLP and First Eastern Investment Group (the “Virgin Consortium”)."
Bryan Sanderson, Chairman of Northern Rock, observed that:
“This is very good news for Northern Rock. Over the last few weeks and months we have looked at the issues from the perspective of all stakeholders. I am grateful for the support that we have had from customers and employees who have stayed loyal to us during these difficult times – and pleased that a solution that firmly restores the Company’s prospects has been identified. Furthermore our retail depositors can be fully reassured that the Government has said it will ensure savers’ money is safe whatever the outcome.”
Should the deal go ahead, the Virgin-led group has agreed to inject GBP1.3 billion into the ailing bank, in return for a controlling stake.
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