Branson steps up Northern Rock bid (Irish Independent)

04 November 2011

Richard Branson's Virgin Group is reportedly planning a sweetened bid for Northern Rock as the British government is poised to outline financial support for a private sale.

The Virgin-led consortium is understood to be working on an improved offer to gain the support of shareholders.

It comes ahead of today's Commons statement from Chancellor Alistair Darling, which will set out plans to convert Northern Rock's £24bn of Bank of England emergency loans into bonds and sell them to international investors.

Mr Darling is also expected to give Northern Rock's suitors, Virgin and Olivant, two weeks to table plans for financing and management.

Northern Rock's shareholder base still presents a significant hurdle to any private sector sale, with the approval of the bank's investors needed to secure a takeover.

Robin Ashby, head of the Northern Rock Small Shareholders Group, warned that it was unlikely Virgin's current offer would be accepted.

Olivant's plans are widely seen as the shareholders' favourite, as it would not involve a takeover or break up of Northern Rock.