Nationwide, based in Pipers Way, has put forward a 220p-a-share approach for High Street lender Virgin Money worth £2.9bn, in a move that would create the UK’s second largest mortgage and savings group.
At the moment only a preliminary agreement has been reached, which would also include a planned 2p-per-share dividend payout. Nationwide will now be going through the books of Virgin Money before a firm offer is made.
If formalised, the deal would create a combined lender worth around £366.3 billion with 696 branches, making it the second largest group branch network behind Lloyds Banking Group.
Nationwide has already stated that in the short term it would not make any material changes to Virgin Money's 7,300-strong workforce but it is planning to rebrand Virgin Money as Nationwide within six years.
Debbie Crosbie, chief executive of Nationwide Building Society, said: “Importantly, Nationwide will remain a building society, and a combined group would bring the benefits of fairer banking and mutual ownership to more people in the UK, including our continuing commitment to retain existing branches as part of our Branch Promise, and leading levels of customer service.
“We believe the combination would create a stronger and more diverse business that will be better placed to deliver value to our members and customers, both now and in the future.”
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