Yorkshire and Clydedale Bank is set to have a market capitalisation of £1.54bn to £2.07bn, its owner announced today.
National Australia Bank’s price range for the initial public offering of its UK banking operations is lower than previously expected.
Speculation had put CYBG plc at £2bn to £2.5bn.
Shares have been hit by global economic turmoil at the start of 2016, but NAB is determined to press ahead with the transactionj.
“If volatility in equity markets were to become more pronounced, it is open to us to have a smaller IPO, or defer the IPO or whatever, and to let us continue with the demerger,” chairman Ken Henry was quoted as saying by the Sydney Morning Herald.
“But I fully anticipate that we will have a very successful IPO of the 25 per cent.
“The early indications we have had, based on conversations with more than 300 investor groups, leads us to think this will be a successful IPO.”
CYBG management, led by chief executive David Duffy, will start global marketing in the City of London today. The roadshow will also take in New York and Australia.
Mr Duffy is promoting CYBG as Britain’s number one challenger bank and has set ambitious growth targets for the Leeds-registered lender, which has a £28bn loan book.
NAB is pursuing a demerger of 75 per cent of CYBG to NAB shareholders and a divestment of the remaining 25 per cent by IPO to institutional investors.
The proposed IPO price range has been set at between 175 pence and 235 pence per CYBG share.
CYBG shares will be listed on the London Stock Exchange’s main market and the first day of conditional trading is set for February 2.
NAB will complete its long-awaited exit from the UK a week later following the demerger and IPO.
The transaction will result in independence for Yorkshire Bank for the first time in nearly 100 years.