UK based, The Co-operative Bank is apparently discussing takeover terms with a US private equity firm, as it is being speculated that that the UK banking sector is heading towards a series of merger and acquisition deals.
As per credible reports, the bank has stated that it had been approached by a financial sponsor with knowledge and experience of investing in European financial services sector regarding the potential sale of the bank and/or the holding company. Speculations have it that deal would be backed by the New York-based Cerberus Capital Management, however not confirmed.
Speaking on the matter, Director of Co-op Bank’s Customer Union for Ethical Banking, Ryan Brightwell, has stated that they expect the new owners to maintain the lender’s ethical position which otherwise can lead to losing of customers. He also added that if these takeover proceeds, they will be looking for reassurances regarding the same.
For the records, the bank seemingly has over 3.3 million personal customers, 85,000 business clients and 50 branches across the UK, regards itself as an ethical lender, although in 2013, it was bought out from the Co-operative Group.
Additionally, it is owned by a group of US hedge funds such as Silver Point Capital, Anchorage Capital, GoldenTree, Blue Mountain and Cyrus Capital along with the fund manager Invesco. Together they hold 85% of the ownership in the bank, while the remainder is held by a range of undisclosed institutional investors. These hedge funds reportedly took full control from the Co-operative Group, a mutual having 19th-century roots, after signing a £700m rescue deal in 2017.
The Co-operative Bank is currently striving to make profits since and presently in the middle of a five-year turnaround plan initiated by ex-chief executive Andrew Bester. Bester however, resigned last month. The position has now been filled by the former finance chief Nick Slape.