Nationwide cements its position as largest Building Society

Virgin Money UK said it has agreed to a takeover by Nationwide Building Society.

Under the Nationwide over, Virgin Money UK shareholders to receive 218p per share in cash, as well as 2p dividend from Virgin Money. This bring the total to 220p. The Nationwide takeover offer values all of Virgin Money equity at GBP2.9 billion, this marks a 38% premium to Wednesday. Nationwide and Virgin Money said the combination will create a group with GBP366.3 billion in assets.

This will represent “the second largest provider of mortgages and savings in the UK.” Nationwide said: “Nationwide has grown over time through a series of historical acquisitions to become the UK’s largest building society. Nationwide remains wholly committed to being a building society and a modern mutual that meets its customers’ and members’ banking needs to a high standard.”

In a separate announcement, Virgin Money UK said it has suspended its share buyback programme amid Nationwide takeover bid.

Comment:  Nationwide is already one of the leading buy to let lenders, operating under the name The Mortgage Works.

Financial pundits are now speculating that Onesavings Bank (OSB) may be the next target for consolidation by a larger rival. OSB’s brands include Precise, Kent Reliance, Interbay, Heritable and Charter Savings bank

 

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