Behind every billionaire there is a story!

Northern Rock Favors Virgin Offer; Treasury Approves

 Northern Rock Plc, the U.K. mortgage lender bailed out by the Bank of England two months ago, said the government backed Richard Branson’s Virgin Group Ltd. as the preferred bidder for the company. Virgin’s offer includes an immediate 11 billion-pound ($22.7 billion) repayment toward about 25 billion pounds lent to Northern Rock by the central bank, Newcastle, England-based Northern Rock said today in a statement. Virgin would inject 1.3 billion pounds into the company, including half funded by an offer of new shares at 25 pence each to existing holders.

“It looks like Virgin have found a way of getting some positive value but this indicative proposal values Northern Rock some way lower than Friday’s closing share price,” said Simon Willis, a London-based analyst at NCB Stockbrokers. Northern Rock fell 16 percent to 72 pence in London trading as of 8:10 a.m., giving it a market value of 303 million pounds.

Virgin, which would combine Northern Rock with its Virgin Money unit, is backed by billionaire Wilbur Ross, American International Group Inc., Toscafund Asset Management LP and First Eastern Investment Group

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