The Wellcome Trust, the medical research charity, has emerged as a backer for private equity firm Blackstone's bid for more than 300 Royal Bank of Scotland branches. The Trust's investment arm, which is responsible for providing £650m of funding for the charity's activities from a £14bn portfolio, has been taking a more active role in private equity consortiums in recent years.
The organisation is understood to have joined Blackstone as a financial backer and will not be involved in any management activities. It already has an involvement in bank ownership having been part of the consortium that bought United, a Florida-based bank.
Wellcome is also known to be interested in further deals that might become available and its involvement is something of a coup for Blackstone, as it could ease political concerns over the prospect of a private equity concern owning one of the "new" banks that the Government hopes will inject competition into Britain's banking market.
Blackstone and Wellcome face competition from Banco Santander, widely seen as the front runner, together with National Australia Bank, and Virgin Money, Sir Richard Branson's banking operation. The list of contenders also includes BBVA, another Spanish banking business.
None of the bidders have yet had the chance to conduct due diligence on the RBS business, which is being sold to satisfy the demands of EU regulators. They have ordered RBS to spin off several businesses following the massive injection of state aid it has received to prevent the company from going under.Reuse content