Exclusive: Virgin Money to IPO on Friday, but prices shares at bottom of range

 
Emma Haslett
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The bank will float a 25 per cent stake on Friday (Source: Getty)

The long-awaited flotation of Virgin Money will take place on Friday, although it is planning to price its shares right at the bottom of their range, City A.M. understands, .

Earlier this month, we revealed the challenger bank will target a share price of 283p-333p when it launches its IPO, valuing it at £1.25bn-£1.45bn. But a source close to the deal said the bank had opted to price its shares at 283p, which will put its value at £1.25bn. It is likely to exercise its greenshoe option when it lists, which enables existing shareholders to sell more shares.

The source added that half the demand for shares had come from outside the UK, suggesting British investors continue to be cautious following recent market turbulence.

Virgin Money confirmed its plans to IPO last week, after it shelved them in October following market turbulence

But as the markets settled, and following new guidance from the Financial Policy Committee which confirmed its financial buffer was "in excess of the recommended requirements", it decided to go ahead with its flotation.

Jayne-Anne Gadhia, the bank's chief executive, said access to the public capital markets had been "a long-term strategic objective for Virgin Money".

Virgin Money did not comment.

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