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Latest On Northern Rock Sale
bristolleedsfan
Posts: 12,649 Forumite
Looks like its now gonna be Virgin as long as Virgins sums add up.
http://www.guardian.co.uk/business/2008/feb/04/northernrock.banking1
( Current NR were muted to be putting together a in house rescue package)
http://www.newsnow.co.uk/newsfeed/?name=Northern+Rock
Virgin were confident of getting the Government vote anyway. :rolleyes:
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3301072.ece
Share Price back down to 88.50p.
http://www.guardian.co.uk/business/2008/feb/04/northernrock.banking1
( Current NR were muted to be putting together a in house rescue package)
http://www.newsnow.co.uk/newsfeed/?name=Northern+Rock
Virgin were confident of getting the Government vote anyway. :rolleyes:
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3301072.ece
Share Price back down to 88.50p.
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Comments
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Yep. Shame really, the majority of shareholders wanted to be backed by Olivant.
However Virgin are said to offer additional shares a 25p each to shareholders to raise capital if they do go through with it.0 -
Yep. Shame really, the majority of shareholders wanted to be backed by Olivant.
However Virgin are said to offer additional shares a 25p each to shareholders to raise capital if they do go through with it.
Virgin were/are looking for NR shares to be down to that level as well. :eek:
Personally i would rather Europe throw it all out on competition grounds than Virgin get NR, If that means Shareholders get nothing as opposed to next to nothing then so be it. :cheesy:0 -
Virgin consortium submits Northern Rock rescue proposal
- A consortium led by Sir Richard Branson's Virgin Group today confirmed that it has submitted a rescue plan for Northern Rock, under which the stricken mortgage lender would be relaunched under the name Virgin Bank.]
In a statement, the consortium said it would provide Northern Rock with 1.25 bln stg injection of fresh capital, of which 500 mln stg would be generated through a rights issue priced at 25 pence per share, a steep discount to the bank's closing price today of 88-1/2 pence.
"We have made a proposal that seeks to stabilise the company and rebuild it as a trusted and thriving institution under the Virgin brand with a long-term future," said Sir Brian Pitman, the former Lloyds TSB chairman recruited by Virgin to chair the re-launched lender.
My friend bought shares in them a few weeks back - what does this mean for him? (I don't understand the rights issue priced at 25p each) Does it mean he gets offered to buy more shares but @ 25p? If so, what happens to the price of his originals?0 -
My friend bought shares in them a few weeks back - what does this mean for him? (I don't understand the rights issue priced at 25p each) Does it mean he gets offered to buy more shares but @ 25p? If so, what happens to the price of his originals?
Only needs a few "bad news NR headlines" and share price will be back down to 55p or lower.
Whats being said is that in order for state aid to end after 3 years NR business will have to be shrunk by no new morgage business being taken on and a big chunk of existing morgagees being asked to find a morgage elsewhere, add to this the probability of no dividends for 3 years.
What will be the point in holding shares in NR/Virgin Bank.? :think:0 -
My friend bought shares in them a few weeks back - what does this mean for him? (I don't understand the rights issue priced at 25p each) Does it mean he gets offered to buy more shares but @ 25p? If so, what happens to the price of his originals?
Your friend will essentially be forced to buy more shares at 25p each or devalue his own holding , if my interpretation of the offer is correct. Basically after the issue of the new shares, each share will be worth a new market value, and that value I reckon will be in the 30-35p range because of the massive dilution effect this issue of new shares will have. If you've bought at 25p, then the value of those particular shares is likely to go up, but it may or may not offset the loss of value for the existing shares.
This was always going to be the risk, and it's why for months I and others have been pointing out the dangers of investing in a company with such an uncertain future.I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
So basically they want to downsize operations so they can get the money? Surely this is the best thing to do though?0
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So basically they want to downsize operations so they can get the money? Surely this is the best thing to do though?
Yes so they get their money back ( hopefully) in three years rather than 5 years which was olivants preferred time scale and also not to fall foul of European competition laws :
So that their is not a resurgent NR in the short/medium term competing with other morgage lenders and at the same time benefitting from state aid.
Looks like Shareholders are saying anybody bar Branson. :j :beer: :j
http://uk.reuters.com/article/newIssuesNews/idUKWLB675420080204?rpc=401&0
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