Northern Rock's small shareholders have given their backing to the latest bid from Lugman Arnold's investment group, Olivant.
The Northern Rock Shareholder Action Group (NRSAG) says the offer is the best option currently available to shareholders in Northern Rock.
A spokesman for NRSAG, Roger Lawson, says the offer will ask existing shareholders to subscribe to new shares, similar to Virgin Group’s bid, but there would be less dilution of share value, meaning shareholders would own a larger stake in the company.
Olivant has proposed to take a 15% stake in Northern Rock, considerably less than Virgin’s 55%, and has also offered to repay £15bn worth of Treasury loans immediately, with the rest to be paid by 2009. Olivant also says it will keep the Northern Rock brand, whereas Virgin wished to rebrand the bank under its own Virgin Money brand.
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