Citigroup looking to offload Egg
US financial giant Citigroup is reported to be looking for buyers for its Egg Internet banking operation which was acquired back in 2007 for over £500 million. The operation, which was originally part of the Prudential Group, has been hit by the difficult trading climate in the UK and posted a loss of £106 million in the six months to June 2009. However, it is the underlying financial strength of Citigroup as a whole which has probably forced the group to enter talks with potential buyers.
The company is said to be in talks with a number of potential trade and private equity buyers although as yet no figures have been mentioned although the group is unlikely to recoup anywhere near the £500 million invested just three years ago. It will be interesting to see if a deal can be struck in the short to medium term and at what level the company is willing to dispose of the operation.
Even though the Egg operation was literally created from nothing, and grew very quickly into one of the U.K.'s best known online banking operations, Prudential found it difficult to sell on the operation in the past. Indeed after buying out its original partner in the operation in 2005, in a deal which valued the company at £900 million, it was later forced to take a large loss on the sale to Citigroup.
Share this..
Related stories
RBS to close 44 branches
04/04/2014
The Royal bank of Scotland is set to close 44 UK branches, with 14 of those being classed as the “last banks in town.” The closures have been announced despite the bank making a pledge in 2010 not to close its branches.
However, an RBS spokeswoman stated “the world has changed since then,” citing a 30% fall in branch transactions since the pledge was originally made.
Cash held in bank accounts “temporarily” protected
01/04/2015 People who have large amounts of money in their bank accounts for a small amount of time will now have their money protected in the event of their bank failing. The Bank of England has announced that the Financial Services Compensation Scheme (FSCS) will be extended to include large sums of money that is in people’s bank accounts “temporarily”. The FSCS can pay compensat...
Read MoreUnauthorised overdraft rates at 10 year high
Despite the fact that the current and the previous UK governments promised to assist UK consumers with their banking arrangements and standard of service from the financial industry, it has been revealed that the average unauthorised overdraft rate in the UK is at a 10 year high of 14.22%. When you consider this rate is against a backdrop of just 0.5% for UK base rates it really does show how expe...
Read MoreStep one on the road to a Post Office bank
The UK government will today announce plans to expand and improve the 11,500 strong Post Office network in the UK. This comes just months after the UK government attempted to sell off a significant stake in the UK postal system and follows a period when hundreds of UK Post Office branches have been closed or downgraded. So what can we expect in the short term? The UK government is set to increa...
Read MoreLloyds Bank receives record number of complaints
In the first six months of 2010 Lloyds Bank received the equivalent of 1850 complaints each and every working day. This is by far and away the highest number of complaints for any banking brand in the UK and surprisingly only 12% of the complaints were upheld by the company. Even though the figures are potentially distorted by unauthorised overdraft payment complaints, which were subsequently over...
Read More