UK-based challenger banks OneSavings Bank and Charter Court Financial Services are reportedly in advanced stage of negotiations about a merger.
The merger, is successful, will create a lender with market value of more than £1.6bn ($2.13).
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Onesavings-Charter Court merger:
According to the Bloomberg, OneSavings Bank (OSB) may acquire all ordinary share capital of Charter Court on the basis of an exchange ratio of 0.8253 new OSB shares.
If the transaction is completed, One Savings Bank shareholders will hold majority stake in the combined firm with 55% stake.
The Charter Court shareholders will own the remaining 45% interest, reported Reuters.
OneSavings CEO Andy Golding is expected to lead the combined group.
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By GlobalData“Subject to the successful outcome of ongoing discussions, the boards of OSB and Charter Court expect to recommend the possible combination to their respective shareholders,” Bloomberg quoted the two companies as saying in a statement.
Background:
Established in 2011 as a part of a private equity buyout of the Kent building society KRBS, OneSavings operates as a specialist lender. It is said to have a market value of £905m.
On the other hand, Charter Court was launched in 2008 as a specialist mortgage bank.
With the merger, the two companies aim to create a stronger mortgage-lending specialist in the UK. The merger is also expected to help the group to leverage combined resources to achieve greater scale.
The news comes barely after few months of rival mid-sized bank CYBG completing the acquisition of Virgin Money, leading to the creation of the sixth largest bank in the UK.
