Nationwide is about to buy Virgin Money for £2.9 billion. Nationwide Building Society will soon own Virgin Money after they agreed on a deal worth about £2.9 billion.
Nationwide has offered to pay 220p for each share of Virgin Money, and they plan to give a dividend of 2p per share too. Shareholders and members of the building society will vote on this offer.
The two companies said yes to this deal after talking earlier this month. Nationwide has spent the last two weeks checking Virgin Money’s details before making this solid offer.
Nationwide shared: “Nationwide’s board agreed that a binding offer to acquire Virgin Money was in the best interests of the society and its present and future members, following full consideration and the appropriate due diligence, and after taking comments from members into account.”
This big move will join together Britain’s fifth and sixth biggest banks. They will have about 24.5 million customers, more than 25,000 workers, and nearly 700 branches.
But, Virgin Money won’t keep its name. Nationwide plans to change Virgin Money’s name to Nationwide within six years, but they will use both names for now.
Nationwide promises to keep a branch open in every place where the new, bigger group works, at least until the start of 2028. They’ve promised to do this for two more years.
Nationwide has stated that they do not plan to make any major changes to Virgin Money’s 7,300 employees within the first year. However, due to ongoing assessments of the combined group’s employee needs, there are expectations for some “limited” effect on staff working in the back office.
The groups commented: “There may be some limited workforce changes to reduce the size of overlapping central functions relating to Virgin Money ceasing to be a standalone publicly listed company,”.
The company reinforced that even if the deal goes ahead and receives approval from Virgin Money shareholders and Nationwide’s members, it will still maintain its mutual society status.
Debbie Crosbie, Nationwide’s chief executive, explained: “This acquisition strengthens Nationwide and means we can offer more value and broader services for our current and future members.”
She added, “More people will experience the benefits of mutual ownership and the customer-focused approach of a building society.”
Virgin Money’s chief executive, David Duffy, remarked: “The proposed combination with Nationwide presents an exciting opportunity to build on Virgin Money’s significant strategic and operational progress, including the consistent growth in our retail and business customers, deposits and target lending.”
