Image Source: VirginMoney
Jamie Hardesty

Member Article

Virgin Money announces 283 pence share prices

Newcastle-based Virgin Money Holdings plc today announces the pricing of its initial public offering at 283 pence per Ordinary Share.

The low pricing reflects caution in a quarter where at least five IPOs in Europe have been postponed or withdrawn amid a stock-market sell off.

Moreover, Richard Branson delayed the company’s floatation earlier this year due to reported volatile market conditions.

Based on the Offer Price, Virgin Money’s market capitalisation will be approximately £1.25 billion at the commencement of conditional dealings.

The Offer is expected to raise total gross proceeds of approximately £312 million (assuming no exercise of the over-allotment option) and approximately £344 million (assuming exercise of the over-allotment option in full).

Virgin Money will receive approximately £150 million of gross proceeds from the Offer.

The selling shareholders comprise Virgin Financial Investments Limited, funds managed by WL Ross & Co, Stanhope Investments and certain directors, members of senior management, the employee benefit trust and other shareholders.

In the Offer a total of approximately 57 million Ordinary Shares will be sold by the selling shareholders (assuming no exercise of the over-allotment option), receiving total gross proceeds of approximately £162 million.

Chief Executive Officer of Virgin Money, Jayne-Anne Gadhia, said: “I am delighted to welcome all our new shareholders to Virgin Money.

“Our capability to deliver growth at meaningful scale, the quality of our balance sheet and the fact that we are unburdened by legacy issues makes us stand apart from other banks, and these strengths give us the potential to deliver on-going returns to our shareholders through both capital growth and progressive dividend payments.

“The completion of our IPO will see us make a final payment to the Government of £50 million as consideration for our acquisition of Northern Rock plc, taking the total paid to over £1 billion.

“As we begin life as a public company, we are committed to maintaining the straightforward, transparent approach to business that we believe helps differentiate us.

“We are passionate about improving competition in UK retail banking and believe that today’s IPO is another step forward for us as we seek to deliver on that objective.

“I would also like to thank all of my colleagues at Virgin Money for their hard work in bringing us to this point. There are many colleagues, like me, who have spent 20 years working with the Virgin brand.

“As we previously announced, each employee will be awarded £1,000 worth of shares in the business upon flotation meaning that all colleagues have a stake in our future success.”

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