Rock suitor in ultimatum threat by Finance News Bulletin
- Home
- »Rock suitor in ultimatum threat
Published: 16/12/07
It has written to Northern Rock accusing it of trying its attempts to negotiate a massive row of credit with Citigroup and Deutsche BankOlivant, led by the former boss of Abbey National Luqman Arnold, also needs its team to take over the Rock's management with instant affectIt felt it was providing important information to Olivant and was trying to meet all its demandsOlivant's frustration is a serious anxiety for both the Rock and for the Treasury - which is frantic to find an orderly solution to the Rock's monetary difficulties that would lead to the gradual repayment of more than £25bn of taxpayer-backed loans to the bank
If Olivant pulls out, there would be just one potential bidder for the astound, a group led by Sir Richard Branson and VirginHowever, it too is not judgment it easy to raise a jumbo loan of £11bn to repay some of the taxpayer-backed loanAlso, many shareholders will be angry if the Olivant plan collapses It had received support from hedge funds and asset institutions scheming almost 25% of the Rock's shares
The Treasury has been operational on a plan to nationalise the Rock, in the occasion that a commercial solution to its problems proves impossible
Visit original article:Related Articles:
Abbey plans 300 new branches - Published:15/12/07
All times are London time look for News in the FTcom siteSearchSearch Quotes in the FTcom siteQuotesCOMPANIES Financial servicesBreadcrumb trail navigation:FT Home > Companies > By sector > monetary servicesServicesAbbey National is to open 300 new branches as part of an ambitious growth plan unveiled by the Spanish bank, SantanderSantander, which acquired Abbey for £95bn in 2004, said it intended to begin opening new twigs in 2009 with a target of increasing its 700-strong branch system to 1,000 by 2012 as part of its plans to revitalize the bankAbbey will look at a figure of locations for the new branches but has said in the past that it is under-represented in regions such as the North-east and the MidlandsThe Santander diagram comes as rivals pace up branch network expansion This year HBOS, which owns Halifax, has exhausted £100m to open at least 50 branches and enlarge a further 50 HSBC is also expenditure £400m on 50 branches in new locationsSince Santander took over, it has naked out costs from Abbey and reduced its workforce from 25,000 to 16,000 It has reduced Abbey’s cost income ratio – a input measure of efficiency – from about 70 per cent to 50 per cent and is also in the process of replacing its ageing in order technology systemsThere has been speculation that Santander might look for more UK acquisitions but António Horta-Osório, Abbey’s chief decision-making, supposed: “We are always open to consider opportunities, but we are very focused and our main priority is this scheme of internal enlargement”Abbey, the UK’s third-largest lender, forecast UK house prices would “decelerate” in a soft hallway for the property market It was criticised last year for contribution mortgages to consumers that were five era their income amid concerns consumers were being confident to overstretch themselves However, Mr Horta-Osório said the bank was still offering these loans and stressed that praise quality in the Abbey book remained strong Copyright The monetary Times Limited 2007Final IT changes at Abbey - Dec-09António Horta-Osório, CEO of Abbey National – CV - Dec-09In deepness: Financial services - Dec-09Abbey is latest to delay tie issue - Nov-22Santander benefits from asset sell-off - Oct-27More from this sectorMaverick China sum Profiles: Chinapay, Providing Online sum Solutions for Chinese Banks Maverick porcelain Research12/3/2007$1000Maverick porcelain Payment Profiles: 99Bill, Hot Out of the Gates, but Sustainable nonconformist China Research12/3/2007$1000BlogsBrussels BlogCharles PretzlikClive CrookDear LucyEconomists’ ForumEnergy FilterJohn GapperGideon RachmanTech BlogThe in secret EconomistWestminster BlogWillem Buiter’s MavereconRegional pagesLatin American agendaChinaIndiaBrusselsInteractivePodcastsDebates & pollsAsk the expertMarkets Q&AJobs and classifiedsBusiness for saleContracts & tendersJobs Search kind your search criteria below:* Minimum delay 15 minutesAll era are London timeFT HomeSite mapContact usHelpAdvertise with the FTMedia centreStudent offersFT ConferencesFT SyndicationCorporate subscriptionsFT GroupPartner sites: Chinese FTcomLes EchosFT DeutschlandExpansionInvestors ChronicleExec-Appointmentscom© Copyright The Financial era Ltd 2007 "FT" and "Financial era" are.
Read More: Abbey Plans 300 New Branches >>Flowers quits race for Northern Rock - Published:12/12/07
All times are London time look for News in the FTcom siteSearchSearch Quotes in the FTcom siteQuotesCOMPANIES Financial servicesBreadcrumb trail direction-finding:FT house > Companies > By sector > Financial servicesServicesJC Flowers, the private equity group has walked away from the offer auction for Northern Rock, the suffering bankThe US group, which submitted a revised suggestion last week, is understood to have sent letters to Northern Rock and to the coffers last night saying that it could not give a revised offer that would both provide value to shareholders and please government supplies on the sale of Northern RockThe JC Flowers proposal, which future repaying £15bn of Bank of England funding, would have only given shareholders a nominal amount even though their support would be needed to get the bid throughIt is understood that during meetings with Northern Rock this week, JC Flowers concluded that it did not see how it could meet its own financial hurdle tax while satisfying the government and shareholdersJC plants has now made it clear it will not hold any more meetings or do further work on a revised offer “unless the parameters change”Northern Rock is also expected to take delivery of a revised proposal today from Olivant, the private evenhandedness group led by Luqman Arnold, a former Abbey National chief executive, which will see him parachute new organization into the collection Cerberus, the private equity collection, is still consideration to be interestedThe bank has borrowed about £25bn from the Bank of England and it is thought to be bearing in mind a number of different fallback options, including going into sprint off” – not taking on new business – should its sale failThis prospect includes running down its mortgage book over a era of time and selling certain assets to shrink its balance sheetThis form of winding down the corporation would not engage Northern Rock’s being nationalised or put into administrationIt could also allow Northern astound to take advantage of financing letters being lined up by a number of banksNorthern Rock could have a loan of against some mortgage assets and potentially pay back part of the Bank of England loan and the rest over a era of yearsThe Virgin consortium still has to finalise financing as it tactics to pay back more than £11bn of store of England fundingHowever a person close to the situation supposed financing was likely to be difficult and commercial banks providing financing could require better security to set against the loanThe commercial banks are responsibility due diligence and are now conducting detailed deliberations about the financing including the type of collateral which could be second-hand to set against a loanThe amount borrowed from the Bank of England has increased by £600m–£650m since last week, of which half was due to savers withdrawing their money from the store The rate of investments withdrawn from the bank has slowed in the past fortnight since the Virgin group was named as favored bidderNorthern Rock, plans to give its 1m savers a Christmas bonus, rising the savings rate it pays by 05 per cent in December and JanuaryCopyright The Financial Times Limited 2007World View: astound response risks undermining London - Dec-06Warning of Rock evils tarnishing London - Dec-06Olivant puts its marker on astound - Dec-05Brussels approves astound rescue aid - Dec-05In deepness: Northern Rock - Sep-17JC Flowers attempts to reopen N Rock bid - Dec-04More from this sectorMaverick porcelain Payment Profiles: Chinapay, Providing Online sum Solutions for Chinese Banks Maverick China Research12/3/2007$1000Maverick porcelain Payment Profiles: 99Bill, Hot Out of the Gates, but Sustainable Maverick porcelain Research12/3/2007$1000BlogsBrussels BlogCharles PretzlikClive CrookDear LucyEconomists’ ForumEnergy FilterJohn GapperGideon RachmanTech BlogThe in secret EconomistWestminster BlogWillem Buiter’s MavereconRegional pagesLatin American agendaChinaIndiaBrusselsInteractivePodcastsDebates & pollsAsk the expertMarkets Q&AJobs and classifiedsBusiness for saleContracts & tendersJobs look for Type your search criteria below:* Minimum delay 15 minutesAll era are London timeFT HomeSite mapContact usHelpAdvertise with the FTMedia centreStudent offersFT ConferencesFT SyndicationCorporate subscriptionsFT GroupPartner sites: Chinese FTcomLes EchosFT DeutschlandExpansionInvestors ChronicleExec-Appointmentscom© Copyright The Financial Times Ltd 2007 "FT" and "Financial era" are trademarks of The Financial.
Read More: Flowers Quits Race For Northern Rock >>Darling asks Rock to consider rival bids - Published:04/12/07
All era are London time Search News in the FTcom siteSearchSearch speech marks in the FTcom sitespeech marksCOMPANIES Financial servicesBreadcrumb trail navigation:FT Home > Companies > By sector > Financial servicesServicesAlistair Darling is hoping Northern Rock’s prospect can be decided before Christmas, as his officials give confidence the troubled bank to look beyond Virgin, its favored bidder, at rival offersThe chancellor expects a bidding war to smash out in the coming days, which he believes will help him secure the best likely outcome for the taxpayer, at present backing loans of more than £22bn to the bankLast week it seemed the contest was over after Northern Rock selected a group led by Virgin as preferred bidderHowever, in the past three existence, the stakes have been raised, as it emerged that Cerberus, the confidential equity collection, submitted a revised proposal on Friday, as did private equity group JC FlowersIt is understood Mr sweetheart now deems the revised JC Flowers offer an accepted bid”, because it meets the Treasury’s principles for the sale, aimed at getting better the huge community loan advanced to Northern RockThe JC Flowers bid offers to repay £15bn of the taxpayer loan frank, and the remainder in the next three years at a profitable rate of interest“Clearly it makes sense to have more than one paying attention party, from the taxpayer point of view and also from the point of view of Northern Rock shareholders,” said one official close to the dealAlthough Mr Darling’s officials be adamant he is not setting a time-table, those working on the deal say the chancellor hopes Northern Rock can choose a bidder before Christmas, drawing a line under a embarrassing episode“The government would like this to be resolved rapidly but we require to make sure we get the right deal,” said a orator The Treasury, as the Rock’s biggest creditor, has a veto on any deal and could yet nationalise the bankJC Flowers, which had talked about taking Northern astound private, indicated it would be flexible about whether the bank would stay a community companyOlivant, the private equity group headed by Luqman Arnold, former leader executive of Abbey National, is due to lodge its full proposal this weekMr Arnold has the support of Northern Rock’s biggest shareholders counting hedge funds SRM and RAB which must vote any contract throughNorthern Rock saw a large loss of deposits in mid-November and the decision to name Virgin as favored bidder halted the rush of withdrawalsOne person familiar with the situation suggested that identification a preferred bidder might have given the Northern astound board more time to consider other bidsKey to any bid’s achievement is receiving financing to repay part of Northern Rock’s £22bn of debt payable to the Bank of EnglandVirgin, which is hoping to get financing from regal Bank of Scotland, Citigroup and Deutsche Bank, has about three weeks to safe financing commitmentsDeutsche Bank the past rejected suggestions it was about to walk away from the Virgin deal Copyright The Financial era Limited 2007In depth: Northern astound - Sep-17JC Flowers makes new ‘flexible’ astound bid - Nov-30Contrasting font battle on Rock face - Nov-30Lex: Valuing Northern Rock - Nov-30Rock seeks completely financed plan from Olivant - Nov-28Sir Brian adds financial power to Virgin quest - Nov-28More from this sectorBlogsBrussels BlogCharles PretzlikClive CrookDear LucyEconomists’ ForumEnergy FilterJohn GapperGideon RachmanTech BlogThe in secret EconomistWestminster BlogWillem Buiter’s MavereconRegional pagesLatin American agendaChinaIndiaBrusselsInteractivePodcastsDebates & pollsAsk the expertMarkets Q&AJobs and classifiedsBusiness for saleContracts & tendersJobs Search Type your look for criteria below:* Minimum delay 15 minutesAll era are London timeFT HomeSite mapContact usHelpAdvertise with the FTMedia centreStudent offersFT ConferencesFT investigate CentreFT SyndicationCorporate subscriptionsFT GroupPartner sites: Chinese FTcomLes EchosFT DeutschlandExpansionInvestors ChronicleExec-Appointmentscom© Copyright The Financial era Ltd 2007 "FT" and "Financial era" are trademarks of.
Read More: Darling Asks Rock To Consider Rival Bids >>