Virgin Money stock climbs 1.2 % on listing
13 Nov 2014
Virgin Money, the UK bank part-owned by entrepreneur Sir Richard Branson, raising at least £312 million ($492 million) against the bank's expectation of raising £150 million from the sale.
The shares were sold for 283 pence apiece, valuing the bank at £1.25 billion, the company said in a statement today. The IPO has been delayed by last month's market sell off.
Virgin Money stock climbed in its first day of trading. The stock, priced at the bottom of a range that went as high as 333 pence, gained 1.2 per cent to 286.5 pence at 11:40 a.m. in London.
Employees would each receive £1,000 worth of shares in the business.
Shares are expected to officially start trading on 18 November.
Chief executive Jayne-Anne Gadhia said, "As we begin life as a public company, we are committed to maintaining the straightforward, transparent approach to business that we believe helps differentiate us.
"We are passionate about improving competition in UK retail banking and believe that today's IPO is another step forward for us as we seek to deliver on that objective," she said.
According to the company, on completion of the initial public offering, it would repay the government the final £50 million that it owed for its 2011 purchase of part of Northern Rock.
The company bought the banking and mortgage lending arm of the old Northern Rock bank, which the Bank of England bailed out in 2007 during the sub-prime mortgage crisis.
While all shares on sale were ordered within a day of opening, the low pricing reflected caution in a quarter where at least five IPOs in Europe had been postponed or withdrawn amid a stock-market selloff. Virgin Money and Aldermore Group Plc delayed sales in October.
W L Ross & Co, the investment manager run by US billionaire Wilbur Ross, and the company's management organised the sale of shares to institutional investors. The sale was led by Bank of America Corp and Goldman Sachs Group Inc.
