Metro Bank’s share price soared by almost 50 per cent today after news of a takeover approach was announced.
The bank said it has been approached by the US based private equity firm Carlyle, about a potential offer to take it private.
It becomes the latest UK firm to attract interest from an overseas bidder in what has been a busy year for both mergers and acquisitions of UK firms by foreign companies.
Under UK takeover rules Carlyle has until 2 December to announce whether it intends to table a bid
UK firms either merged with or acquired by foreign companies accounted for deals worth £27.7 billion between April and June this year, according to ONS figures, up £8.3 billion on the three previous months and shows no sign of slowing.
Metro Bank would not reveal how much its suitor may pay, but under UK takeover rules, Carlyle has until 2 December to announce whether it intends to table a bid or walk away.
Metro Bank’s share price rose by almost 50 per cent from a low of £100.50 at the start of the day to a high of £147.80 just before midday.
It has since fallen to just above £1.32 meaning the bank’s current market value stands at around £228million.
Metro Bank, which launched in 2010 and services more than two million customers has been focusing on consumer lending as it strives to turn a profit since a major accounting error in 2019.
Metro also estimates the pandemic cost it £124million last year, of which around £100million was in expected credit losses from customers who cannot repay their loans.
Last year, the challenger bank unveiled pre-tax losses of £311.4 million for 2020, more than double the £130.8million loss recorded in 2019.
However. the bank appears to be recovering somewhat as it looks to reverse most of its year-to-date losses.
Total cash deposits at Metro Bank slipping in the third quarter, a trading update last month revealed, the group said third-quarter net loans were at similar levels to the previous quarter, as a reduction in its exposure to lower-yielding residential mortgages offset growth in unsecured consumer lending.
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