press release 25 June 2018 CYBG seals deal for Virgin Money as challengers set to challenge together CYBG and Virgin Money confirm takeover deal initially announced in May Branson’s Virgin Money is set to be bought for £1.7bn and will give Virgin shareholders a 38% stake in the combined group The Share Centre maintains its ‘hold’ recommendation for Virgin Money As Virgin Money and CYBG agree £1.7bn takeover deal Graham Spooner, investment research analyst at The Share Centre, explains what it means for investors: “This morning we have had confirmation that Virgin Money has accepted the takeover offer put forward in May from CYBG. Formed out of the union between two other small banks, Clydesdale and Yorkshire Banks, the group said it had agreed with Sir Richard Branson’s Virgin Group to license the Virgin Money brand for £12m a year, rising to £15m later. “Expected to be complete in the final part of the year, the bank takeover will create Britain’s biggest challenger bank. Through the combination of its strengths, complementing Virgin Money’s well recognised brand and CYBG’s strong presence in current accounts and personal banking; the group hopes to disrupt the banking status quo. “It plans to retain the Virgin Money brand and plans to attract the younger customer who is expected to do all their banking digitally. At a time when the banking industry is undergoing significant change due to customer shifts toward digital, the group is set to have a strong digital presence and is bound to be snapping at the heels of the larger banks. “We had seen a modest but positive reaction in Virgin Money’s share price at Friday’s closing as the all-share offer values its share at 371 pence; while CYBG’s remained flat. However, Virgin Money’s progress was offset by CYBG’s poor performance and is now down. “Investors will be casting an eye over the sector potentially looking for further consolidation in the sector; the news also highlights the changing landscape within the banking sector as traditional banks disappear from the high street. Based on the unstable response in the shares and an indefinite outlook as the transition will take place over the next two to three years, it’s difficult to say that this stock is any better than a ‘hold’.” ---Ends--- Notes to editors We have an ISDN line for radio interviews and a live in-house broadcast camera via the Globelynx network for television interviews. Please contact [email protected] to make a booking. For additional information, please feel free to contact: Sophie Hobart Holly Deegan PR Manager PR Coordinator Team Spirit PR The Share Centre The Share Centre 020 7360 7878 01296 439 129 01296 439 425 [email protected] [email protected] [email protected] Risk Warnings: Investing in general, and the products and services mentioned above may not be suitable for all: if in doubt, individuals should seek independent financial advice. The value of investments and the income from them can go down as well as up and investors may not get back their original investment. Past performance is not a reliable indicator of future performance. The bases and levels of taxation relating to ISAs, CTFs and SIPPs are subject to change and the value of these tax allowances may depend upon the circumstances of the individual. The Share Centre Limited is a member of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority under reference 146768. Registered in England No. 2461949. Registered office - Oxford House, Oxford Road, Aylesbury, Bucks, HP21 8SZ. .