The battle for Northern Rock has been whittled down two bidders, after Cerberus, the American private equity firm, dropped out of the running for the troubled bank, The Times reports.
Sources close to the bank said that only two bids were being seriously considered by the Northern Rock board and its advisers. Virgin Group remains the preferred bidder, but shareholders favour a proposal from a consortium led by Luqman Arnold, the former Abbey National chief executive.
Northern Rock is expected to update the market within days on the effect on itgs finances of the credit crunch. The bank promised in September that it would issue a pre-close statement in “early December”.
THE CREDIT CRUNCH has taken its toll on the FTSE 100 with seven companies set to be relegated from the benchmark UK index in the biggest shake-up since the dotcom crash, The Telegraph reports.
Northern Rock is among those to be demoted to the FTSE 250 after the seizing up of the debt markets led to the mortgage lender's collapse.
Other victims of the credit crisis on their way out of the FTSE 100 include pub groups Mitchells & Butlers (M&B) and Punch Taverns, and home builder Barratt Developments. They will be relegated alongside Tate & Lyle, the troubled sugar giant, DSG International, the electrical goods retailer, and Daily Mail & General Trust, the newspaper publisher.
ROYRAL BANK OF SCOTLAND is planning to scrap ABN Amro's joint venture with Rothschild, the blue-blooded investment bank, as part of its takeover of the Dutch lender's business, The Independent reports.
The link-up in equity capital markets will finish at the end of this year. It is understood there will be no job cuts and that ABN's 100 staff will be reabsorbed while the remaining 50 bankers will return to Rothschild.
The business was formed in 1996 to arrange and underwrite equity transactions in Europe, Asia and Australia. The banks said they had taken the decision to end the venture following the RBS consortium's acquisition of ABN in October and in light of changes in the global investment banking business.
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