- Mutuo founder Peter Hunt said a successful deal would be a defining moment
- The deal would be the first acquisition by a bank building society of this scale in the UK.
- Hunt said he was not qualified to give an opinion on the financial merits of the deal.
Nationwide’s attempt to acquire Virgin Money for £2.9bn has in principle won the backing of the most influential mutual lobby.
Peter Hunt, founder of Mutuo, the UK’s leading advocate for building societies and co-operatives, said a successful deal would be a watershed moment.
“This is what the sector needs,” he said. ‘Building societies have been on the defensive for 35 years, being absorbed by banks and having to justify their existence. “It has the potential to change the climate.”
Nationwide’s bid, led by chief executive Debbie Crosbie, would be the first acquisition by a bank building society of this scale in the UK.
Hunt said he was not qualified to give an opinion on the financial merits of the transaction, but added: “The senior team at Nationwide have managed the business well, which gives me confidence.” This has the potential to be a milestone for the entire mutual sector. If I’m going to trust someone, I’m going to trust him.
Sign of the times: Nationwide bid would be the first bank acquisition of this scale by a building society in the UK
The proposed acquisition has angered some Nationwide members who are denied the right to vote. A petition demanding a voice has garnered more than 1,000 signatures.
Nationwide’s internal polls suggest a majority of its 16 million members would support the bid. However, many customers don’t realize what is happening. Nationwide insists it is not obliged to offer voting to its members. Getting Mutuo’s support is a boost for Crosbie.
In 2021, Mutuo participated in a successful campaign alongside the Daily Mail to prevent mutual insurance company LV from being sold to private equity.
Hunt said the deal “changes the narrative for mutuals” and opens up opportunities for companies to bank with a mutual. Nationwide is the UK’s largest building society and, as a mutual, is owned by its members.
Virgin Money shareholders, the largest of whom is Sir Richard Branson, vote on the acquisition.
A court hearing this week will determine whether Branson, who backed the deal, will be allowed to vote. His Virgin Group will earn up to £400m from its 14 per cent stake.