New bidders for Northern Rock, but rescue still not guaranteed

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A late applicant may supplant Virgin as preferred rescuer for Northern Rock, after winning the support of stranded shareholders. But with even Olivant’s offer seeing no way to return the government’s loan before 2009, the possibility of a longer spell under public administration cannot be ruled out.

Although Virgin Group remains management’s, and the government’s, preferred rescuer for Northern Rock, the alternative bid tables last week by investment fund Olivant is getting serious attention. Its organiser, Luqman Arnold, is an experienced banking strategist credited with turning round another High Street heavyweight, Abbey. And its offer, to take a strategic stake and make a rights issue of shares at the current market price, is attractive to the hedge funds that bo...

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