B&B to pay for failed deal

Source: Exec Digital UK

Date :07/07/2008 09:40:36

Reports suggest Bradford & Bingley is set to pay success fee to Goldman Sachs despite the failure of proposed rescue deal.

The investment bank was behind plans for B&B to raise £400million with the sale of a 23 percent stake to Texas Pacific Group.

The deal broke down, forcing B&B to sell £400million of shares in a rights issue.

Seeking Resolution deal

Last month investment vehicle Resolution offered to invest £400million into the bank.

The proposal was part of a wider £2billion scheme to breathe life into the UK's smaller banks and lenders hit by the credit crunch.

B&B rejected the plan saying it would lead to the investment group effectively taking over the bank.

The bank's four biggest shareholders - Standard Life, Insight, Legal & General and M&G – now want Resolution to return with a rescue deal.