SIMSON JAWA ROMET (!!) :: Przegląd tematu - Tiffany Rings3Northern Rock Shareholders Are Not

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hereafter of Northern Rock, the beleaguered UK bank still remains precarious later the deadline of 4 February 2008 because bids from interested parties.
The UK government is questing to become the estimated GBP25 billion of loans into bonds which will be sold in the open market. In mandate to make these bonds attractive, the government will guarantee them.
It has immediately emerged that in appending to requiring a fare for the vouch, which could be as much for GBP400 million, the UK government is insisting that the guarantee is limited to 3 years. This means that the bonds will only have a 3 year life, and at the end of that time they will absence to be replaced by choice funding.
In practice, Northern Rock will have to seriously downsize, if necessary decimate, its mortgage portfolio. It can only accomplish this target by actively encouraging mortgage holders to move to additional bank and building society lenders.
Due to the severity of this prerequisite by the government, one of the bidders, Olivant, has dragged out.
This leaves 2 propositions on the table for Northern Rock.
The attempt from Sir Richard Branson, of the Virgin team, is considered to be the front runner. Virgins offer is complex and involves merging Northern Rock into Virgin Money.
Northern Rock currently has 420 million shares in issue. Existing shareholders will be asked to subscribe to a rights issue and purchase 6 current shares at 25 pence for every share they currently hold. This equates to GBP1.50 x GBP420 million which equals GBP630 million of new money.
Total shares held by existing shareholders will then be 420 milliin due times 6, which equals 2,520 million, and the incipient 420 million Tiffany Rings, which equals 2,940 million shares.
Virgin proposes namely there ambition be 6,600 million shares. The new shareholders ambition hold 2,940 million when Virgin ambition hold 3,660 million. This method that the existing shareholders will discern a dilution of their combined stake to 45%, while Virgin holds a majority 55%.
Virgin will buy 2,600 milllion shares at GBP25 pence which equals GBP650 million. In addition, they will receive a beyond 1,000 million shares as Virgin Money will be merged with Northern Rock. This amounts Virgin Money at GBP250 million and most commentators consider this a highly expanded diagram.
What this means is that Virgin is acquiring Northern Rock for a money payment of GBP650 million. When one considers that Northern Rock has some GBP100 billion of assets, is one of the altitude 5 UK mortgage lenders with a market share of 20 percent, this seems a most attractive deal for Sir Richard Branson.
Many consider the Virgin bid to be favoured by the UK government. Indeed Sir Richard just happened to be with the Prime Minister as chapter of a UK trade assignment to China in January 2008, and he has a longstanding relationship with the Labour Party which was nurtured during the Blair years.
The Virgin group is a private thing and not listed above whichever stock market. As such its fiscal framework is indistinct. Sir Richard is a consistent ego publicist, and a shrewd and merciless worker. He does have one informal, shore bum arrival. Unlike maximum beach bums from the Caribbean, Sir Richard owns his own personal island of Necker . Concerns have too been expressed by his non UK status for tariff purposes and the possibility that quite mini tariff will be returned to the exchequer whether and when Virgin sell the revamped bank in several annuals period.
In fact Mr Vince Cable, a Liberal Democrat MP Tiffany Sale, has made reference to Bransons elapse illicit behaviour in that he allegedly evaded purchase tax in 1971 and agreed to pay penalties in order to dodge a guilty prosecution.
From the attitude of shareholders, the Virgin offer is unattractive. Many shareholders bought their shares 1 year antecedent when they were amounted at GBP12. Due to the disadvantageous publicity Tiffany & CO Outlet, the shares are currently equitable beneath GBP1.
Many shareholders are ince