LONDON (Reuters) – Virgin Money, part of entrepreneur Richard Branson’s business conglomerate, has been excluded from the race for 318 branches being sold by Royal Bank of Scotland (RBS.L), sources familiar with the matter said on Saturday.
Virgin had been one of four remaining bidders for what could rank as Britain’s sixth biggest bank, but it was told late on Friday that it was no longer in the running, the sources said.
The three bidders now remaining for the branches being sold by part-nationalised RBS — part of a series of forced sales to comply with European Union rules on state aid — are Spain’s Santander (SAN.MC), widely seen as the front runner, BBVA (BBVA.MC) and National Australia Bank (NAB.AX).
Buyout firm Blackstone (BX.N) and charitable foundation the Wellcome Trust had also been in the running, but were excluded last month.
RBS, 83 percent state-owned after it was bailed out through the financial crisis, is selling the branches under the revived Williams & Glyn brand. The network, which would provide a foothold in banking for small and medium-sized businesses, are expected to fetch more than 1 billion pounds ($1.55 billion).
Virgin Money had announced last month it had the backing of U.S. billionaire Wilbur Ross.
Virgin’s plans for the branches, which are seen by the government as the potential platform to build a major competitor for Britain’s major high street lenders, had not included closures or job cuts. Its offer, though, was lower, one of the sources said,
“Ultimately, it came down to money,” the source said.
Virgin, granted a full banking license earlier this year, is now expected to return to its organic growth plans.
Virgin, RBS, Santander and BBVA declined to comment. NAB could not be reached for comment. (Reporting by Clara Ferreira-Marques; editing by James Jukwey)