Virgin Money, the lender backed by billionaire Sir Richard Branson, yesterday launched itself on the stock market with a valuation of around £1.25bn.
The Newcastle-based company priced its shares at 283p – the bottom end of the 283p to 333p range it indicated last week after it revived plans for a listing due to an improvement in stock market conditions.
The issue was scheduled for October but a collapse in investor confidence in the world economy caused a delay to its plans.
The price of the stock market newcomer was little changed in conditional dealings yesterday prior to the formal launch of trading on Tuesday.
The initial public offering (IPO) will raise £150m, which the company intends to use in a drive to boost its share of the UK mortgage lending market to over 3 per cent, as well as to lift its credit card lending from £1bn to £3bn by 2018.
The lender employs more than 2,500 staff, with 1,700 based in Gosforth, Newcastle, and 200 in Norwich. It is owned by Sir Richard’s Virgin Group, Wall Street billionaire Wilbur Ross and an Abu Dhabi investment fund.
Virgin, which provides mortgages, savings and credit cards to 2.8 million people, agreed to buy the former failed lender Northern Rock from the Government for an initial £820m in 2011.
The completion of the flotation will result in another £50m being returned to the taxpayer.