| 13.9°C Belfast

EU regulators back Shawbrook takeover bid

A proposed private equity takeover of challenger bank Shawbrook has been given the green light from EU regulators.

Pollen Street Capital and BC Partners tabled an £825 million offer for the lender in March, but Shawbrook urged shareholders to "take no action" and rebuff the bid.

On Friday, the duo said they have received notice from the European Commission clearing the offer and shareholders now have until 1pm to accept or reject it.

The private equity consortium "urged" shareholders that have not yet accepted the offer to do so before the deadline.

The suitors made an approach through Marlin Bidco to buy the lender for 307p a share in January, before upping its offer to 330p a share in cash.

Pollen Street is Shawbrook's biggest shareholder, owning just under 39% of the lender.

Shawbrook, which specialises in lending to small and medium-sized businesses, warned in an investor circular over "significant" costs of the bid, at around £4 million if it is aborted and up to £12.5 million if it succeeds.

Weekly Business Digest

Margaret Canning’s selection of the must-read business stories straight to your inbox every Tuesday morning

This field is required

The takeover approach comes after Pollen Street Capital floated Shawbrook on the London Stock Exchange at 290p a share in April 2015, valuing the bank at £725 million.

Shawbrook employs 600 people in 10 offices across the UK.