Shareholder green light for CYBG’S Virgin Money buy

● Overwhelming backing for the offer which is expected to complete in Q4

creation of a major banking sector challenger took a big step forward yesterday as shareholders in Clydesdaleowner CYBG and Virgin Money overwhelmingly backed the pair’s proposed merger.

Three motions about the deal were put forward to CYBG shareholders, where more than 96 per cent of the votes were in favour of the recommended all-share offer for Virgin Money.

Virgin Money investors also voted in favour of the deal, with more than 99 per cent supporting it. However, some shareholders rebelled against a resolution giving Virgin Money’s chief executive, Jayne-anne Gadhia, a £619,000 redundancy payout, on top of a termination payment of £1.1 million. She is also due to receive a bonus owed to her of £1m. The vote passed with some 87 per cent in favour.

The centuries-old Clydesing dale Bank name is set to disappear from Scotland’s high streets following the takeover of Virgin Money in a £1.7 billion deal unveiled in June.

The enlarged operation will be headquartered in Glasgow and is seen as a potential competitor to established giants such as Barclays and RBS with a customer base of about six million.

Gadhia said: “I am delighted with the support from our shareholder base in approving the recommended allshare offer for Virgin Money by CYBG.

“Bringing together the complementary strengths of Virgin Money and CYBG will create the UK’S first true national competitor in UK banking, improving competition and choice for all UK consumers, while enabling the Virgin Money franchise to continue to flourish.”

CYBG said that engagement with financial regulators was ongoing. The banking duo remain confident that completion of the offer will occur in the closing quarter of 2018.

CYBG’S David Duffy is staythe on as chief executive. The enlarged group will see CYBG’S Jim Pettigrew continue on as chairman alongside finance chief Ian Smith.

The firms said in June that they recognised “that there will be a loss of jobs” as a result of the takeover, likely to number about 1,500 over three years. The bulk of those cuts are likely to affect senior management positions, as CYBG has said there is “very little in overlap” in customer-facing roles.

CYBG recently announced the appointment of three nonexecutive directors as part of the takeover.

The group, which also owns theyorkshirebank,saidgeeta Gopalan and Darren Pope would be appointed as independent non-executive directors of CYBG while Amy Stirling would become a non-exec director. They will each also join the board of Clydesdale.

Following completion of the takeover offer, Gopalan will be appointed a member of the CYBG risk committee and the Clydesdale Bank risk committee with Pope being appointed a member of the audit committees of both boards.