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Latest update : 2008-06-02

The embattled British mortgage lender Bradford and Bingley may have found a saviour in US private equity firm Texas Pacific Group, which reportedly agreed to purchase a 20% stake in the lender burdened by huge losses from the subprime fallout.

U.S. private equity firm Texas Pacific Group has agreed to take a 20 percent stake in Bradford & Bingley in a much-needed boost for the embattled UK mortgage lender, a source familiar with the matter said on Monday.
The source said the 150 million pound ($296 million) rescue deal will be part of a broader 400 million pound injection, including a rights issue of shares which will be trimmed to 250 million pounds from a previously announced 300 million.
Britain's largest buy-to-let lender, which has seen its share price fall more than 40 percent since it first announced plans for an emergency rights issue last month, will also cut the price of the new shares to 55 pence from 82 pence.
Bradford & Bingley's shares hit a record closing low of 88-1/2p on Friday, valuing the bank at 546 million pounds -- a fraction of its 3.3 billion value at its March 2006 peak.
Monday's news from B&B, which is also expected to include a warning on 2008 profits, is set to rekindle concerns about short-term prospects for the bank and the wider UK mortgage market, and will likely revive speculation of a takeover.
B&B announced the departure of its chief executive, Steven Crawshaw, on Sunday, less than a month after it surprised investors with news of an emergency 300 million pound rights issue.
The bank is due to make its announcement later on Monday. A B&B spokeswoman declined to comment. Texas Pacific could not immediately be reached.

Date created : 2008-06-02