Troubled Manchester-based Co-operative Bank said on Monday it has dropped plans for a sale and will continue its “advanced” discussions with a group of existing investors on a prospective equity capital raise and recapitalisation.
The plan would enable Co-operative Bank to meet the longer term capital requirements applicable to all UK banks and continue as a stand- alone entity.
In a statement on Monday, Co-operative Bank said: “The bank notes recent media speculation referring to ongoing discussions.
“The bank confirms that a majority of the key commercial aspects of the proposal have been substantially agreed between the bank and the investors.
“Discussions with respect to the separation of The Co-operative Pension Scheme into sections for which Co-operative Group Limited and bank have respective responsibility are advanced.
“Discussions are continuing between the parties, including on other key matters, with a view to agreeing the final aspects of the proposal and a further announcement will be made in due course.
“It is anticipated that any agreed proposal would be subject to a number of conditions relating to its implementation.
“Given the advanced nature of the proposal, the board has decided to discontinue the formal sale process under the Takeover Code.
“The bank is, therefore, no longer in an ‘offer period’ for the purposes of the Takeover Code and, accordingly, the requirement to make disclosures under Rule 8 of the Takeover Code has now ceased.”