Talks under way over future of The Co-op Bank

Co-op Bank
X The Business Desk

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US investor Cerberus has returned with a possible bid for Manchester-based Co-op Bank.

According to Sky News Cerberus, which was among bidders for the bank when it last ran a formal sale process in 2017, is in talks once again with the business.

On Tuesday morning, the bank confirmed it had received an approach about a bid but declined to comment on the identity of the suitor.

It said: “The bank has recently attracted an approach from a financial sponsor with knowledge and experience of investing in European financial services businesses regarding the possibility of a sale of the bank and/or the holding company.

“The bank continues to be in discussions with this financial sponsor, although such discussions remain at a preliminary stage.

“There can be no certainty that discussions with this financial sponsor will progress further, or that any binding offer will be forthcoming nor whether the bank’s ultimate shareholders will find the terms of a binding offer (if any) acceptable.”

The bank revealed that it was initiating discussions with investors about raising new regulatory capital.

Cerberus previously bought £13bn of mortgages from British taxpayers in 2015.

According to industry sources, Cerberus is likely to seek a cut-price deal and could offer as little as £200m for the bank which last month appointed former chief financial officer Nick Slape as its new chief executive following Andrew Bester’s decision to step down.

Mr Slape is the bank’s sixth CEO in a decade in which the bank has faced turbulence, ranging from the global financial crisis to an internal scandal in 2013 when the then chairman, the Rev Paul Flowers, faced allegations of drug taking and sexual indiscretions.

In 2013 it also tried to buy more than 630 branches from Lloyds which threw up a £1.5bn hole in its finances that was plugged by hedge funds and the Co-op Group.