AG advises Coventry Building Society

London, United Kingdom – Addleshaw Goddard LLP (AG) advises the UK’s second largest building society, Coventry Building Society (CBS or the Company), in respect of its potential £780 million cash acquisition of The Co-operative Bank Holdings plc (including The Co-operative Bank plc (the bank)) (Bank holdings) (the Acquisition).

In a joint statement made on May 24, 2024, the boards of CBS and Bank Holdings announced that CBS and the principal owners of Bank Holdings, which collectively own approximately 88% of the A shares and 100% of the B shares of Bank Holdings, have signed a share purchase agreement (SPA) under which the Company will acquire the entire issued share capital of Bank Holdings. The shareholders of Bank Holdings will be entitled, in accordance with the Articles of Association of Bank Holdings and the terms of the SPA, to receive an aggregate cash consideration of £780 million (subject to customary post-completion price adjustments and the terms of the SPA) . Of the total cash value, up to £125 million will be deferred for a period of 3 years from completion, subject to the future performance of the Bank and the terms of the SPA.

Subject to the satisfaction of certain conditions, including regulatory approval from both the PRA and the FCA, the acquisition is expected to complete in the first quarter of 2025.

A combination of the Company and the Bank is expected to deepen and expand CBS Group’s existing presence in mortgages and savings and expand the Company’s propositions.

The acquisition would create a combined group with a pro forma balance sheet of £89 billion at 31 December 2023, enabling the Company to leverage its financial scale and diversified funding base to continue to deliver strong member value and increase investment to continue to provide. outstanding service in branches, online, telephone and mobile services.

The acquisition would also give CBS an established position in the personal current account market, expand the Company’s channels and distribution capabilities, including an expanded national footprint, and introduce a business savings and current account proposition to the Company’s offering.

CBS would seek to integrate the Bank gradually over several years, prioritizing good customer outcomes, after detailed planning and engagement with relevant stakeholders had been completed.

Ben Koehne, co-head of financial services and head of the market-leading AG practice, said::