Virgin Money to purchase Northern Rock

17 November 2011

Northern Rock is to be sold by the UK government to Virgin Money for a sum of £747 million ($1.17 billion), it has emerged.

The financier was bailed out by the administration back in 2008 when it was faced with the threat of liquidation due to the impact of the global economic downturn and has since been state-owned.

However, chancellor George Osborne announced today (17 November) that the Conservative-Liberal Democrat alliance has reached an agreement with Virgin Money to sell the lender.

This deal forms part of the government's plan to return all public sector stakes in banks back to the private arena and has been finalised on the basis that it is in the best interests of the taxpayer.

Mr Osborne - who is also MP for Tatton - commented that the agreement "represents value for money" and will "increase choice on the high street for customers" while also "safeguarding jobs in the North East".

By Gary Cooper

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