Yorkshire Bank gets go ahead for Virgin Money takeover

CYBG's chief executive David Duffy
CYBG's chief executive David Duffy
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Yorkshire Bank's parent ​CYBG has received regulatory approval for its £1.7​bn takeover of Virgin Money.

The groups said on Thursday that the Financial Conduct Authority and the Prudential Regulation Authority have given their blessing to the all share deal.

Investors in both firms voted overwhelmingly in favour of the deal last month.

Analyst Gary Greenwood at Shore Capital said: "The all-share combination of CYBG and Virgin Money has received regulatory approval from the FCA and PRA and is now expected to become effective on October​ 15​.​ ​This is in line with management’s previously stated expectation for completion in ​the fourth quarter of 2018.

​"​We currently see fair value for CYBG at 345p (11​ per cent​ upside) and for Virgin Money at 420p (14​ per cent​ upside).

​"​While this is perhaps enough to begin to consider a more positive stance, we continue to see much better upside elsewhere in the domestic mainstream banking sector, with Lloyds being our preferred alternative.​"​