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Aldermore ditches bid for Co-op Bank

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Banking and Fintech Reporter

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The Co-op board said it was confident in the group’s outlook for the year, as it steams ahead with plans to target eight million members by the end of the decade. 
The Co-op board said it was confident in the group’s outlook for the year, as it steams ahead with plans to target eight million members by the end of the decade. 

Aldermore Group has abandoned plans to make an offer for the Co-operative Bank, leaving Shawbrook as the only bidder, Sky News first reported.

The challenger bank’s bid was reportedly derailed by a leadership shake-up at FirstRand, its South African parent company.

Aldermore’s withdrawal leaves Shawbrook as the bank’s only known bidder, with a reported £3.5bn merger proposal.

The deal would largely consist of Shawbrook shares, which banking sources told Sky may not necessarily be attractive to Co-op Bank investors.

City sources told Sky on Wednesday that several other parties remained interested, including Paragon Banking Group and OneSavings Bank, although none have tabled offers.

Analysts had named Aldermore as the most logical strategic buyer of the troubled Co-op bank, which has narrowly avoided collapse twice in recent years.

Talks between Co-op Bank and Cerberus Capital Management broke down in December 2020. The bank made an unsuccessful approach to merge with TSB in 2021.

The sale of the bank comes during a turbulent period for the the wider sector, with Metro Bank being forced to raise emergency funding in in recent weeks.

PJT Partners and Fenchurch Advisory Partners are advising on the Co-op Bank sale.

Co-op Bank declined to provide a comment to City PM, while Aldermore did not immediately respond.