Watchdog launches investigation into Nationwide’s Virgin Money takeover

The CMA said it is considering whether the deal could ‘result in a substantial lessening of competition’ within the UK market.

Henry Saker-Clark
Friday 31 May 2024 09:11 BST
Nationwide Building Society is planning to take over smaller rival Virgin Money (Mike Egerton/PA)
Nationwide Building Society is planning to take over smaller rival Virgin Money (Mike Egerton/PA) (PA Wire)

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Louise Thomas

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The UK competition regulator is to investigate Nationwide’s £2.9 billion takeover of rival Virgin Money.

The Competition and Markets Authority (CMA) said on Friday morning it has launched a merger inquiry in the deal.

It has invited interested parties to give their views on the deal, setting a deadline of June 14 for responses.

It said it is considering whether the deal – which is the biggest UK banking merger since the financial crisis – could “result in a substantial lessening of competition” within the UK market.

The CMA said it will decide whether the deal needs a more thorough phase 1 probe by July 26.

In March, Nationwide and Virgin Money reached an agreement over the deal.

Nationwide struck the takeover deal with a 220p-a-share offer for Virgin Money, including a planned 2p-per-share dividend payout.

Last week, a clear majority of 89% of Virgin Money shareholders voted in favour of the move, helping to clear the path for the deal to complete.

Virgin Money chief executive David Duffy will stand down on completion of the deal, which is expected during the final three months of 2024, while Nationwide boss Debbie Crosbie will head up the enlarged group.

The planned takeover will bring together Britain’s fifth and sixth largest retail lenders, creating a combined group with around 24.5 million customers, more than 25,000 staff and nearly 700 branches.

But the move would spell the end of the Virgin Money brand, with Nationwide planning to rebrand the Virgin Money business as Nationwide within six years, although it will keep the two brands initially.

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