You are here: Home - Saving & Banking - News -

Clydesdale Group seals £1.7bn Virgin Money takeover

0
Written by:
18/06/2018
Virgin Money has agreed to a £1.7bn takeover by the owner of Clydesdale and Yorkshire banks, CYBG Group.

CYBG Group initially offered around £1.6bn for Virgin Money in May with 1.1297 new group shares in exchange for each Virgin Money share, but later upped its offer to 1.2125 new shares, which has been accepted.

It will leave Virgin Money shareholders owning approximately 38% of the combined group when the deal is completed.

The combined bank will have a little over 5% of the UK mortgage market, according to last year’s data from UK Finance.

A statement from the two institutions said it expects a significant majority of Virgin Money mortgages and cash ISAs to be migrated to CYBG platforms on renewal.

Overall an estimated 30% of all accounts of the combined group will be part of a transfer or migration process within its proposed integration plan.

The statement added that the IT migration will be phased over 36 months “to minimise execution risk with operational integration phased over a similar timeframe”.

Six million customers

CYBG CEO David Duffy said the move would create a national, full-service bank with the capabilities needed to compete effectively with the large incumbent banks.

“Together we will serve around six million customers, with the scale, capabilities and financial muscle to disrupt the status quo – and with a clear ambition to provide our customers with the best service in the UK,” he said.

“The strategic rationale is clear and offers both sets of shareholders real value, material earnings accretion, and enhanced capital generation for the benefit of all shareholders, together with both firms’ customers, colleagues and local communities.”

Virgin Money CEO Jayne-Anne Gadhia added that the offer reflected confidence in the bank’s strategy, track record of delivery and the complementary strengths of the two businesses.

“The combination of Virgin Money with CYBG will have greater scale to challenge the big banks. It will also accelerate the delivery of our strategic objectives, particularly the expansion of the products we offer to customers,” she said.

“The combined group will remain a committed voice behind the Women in Finance Charter as well as working to reduce the gender pay gap,” she added.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

How your monthly bills could rise as the base rate reaches 1.25%

The Bank of England has raised the base rate to 1.25% as predicted – the fifth consecutive rise in just six ...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week