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| Investors shy away from B&B offerings |
| 2008-08-19
source:Shanghai Daily |
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BRADFORD & Bingley, Britain's biggest buy-to-let mortgage lender, revealed yesterday that its bankers have been left with more than 70 percent of its 400 million pound (US$747 million) rights issue, confirming expectations of a poor take-up by investors.
B&B, which has been hit hard by the credit squeeze, also announced it has hired the former head of rival Alliance & Leicester PLC as its new chief executive, Bloomberg News reported.
The B&B rights issue, in which a company raises fresh capital by creating and selling new shares to existing shareholders, was one of several by British banking institutions in recent months as they seek to shore up capital lost by the credit squeeze.
Although B&B's 27.8-percent takeup by investors of the new shares was better than the 8.29 percent achieved by the Halifax Bank of Scotland on its much larger 4 billion pound rights issue, the B&B offering still left underwriters with nearly 300 million pounds of shares.
The underwriters, UBS and Citigroup, now have until Friday to offload those shares or become owners.
Richard Pym, who retired as chief executive of Alliance & Leicester a year ago, will take over the reins of the company immediately.
Pym replaces Steven Crawshaw who stepped down in June due to ill health. Chairman Rod Kent has been in charge in the interim.
B&B's rights issue has been more troubled than most, with the lender forced to restructure the offer twice.
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