Olivant makes revised bid for Northern Rock

Olivant, run by Luqman Arnold, the City stalwart and former Abbey chief executive, is thought to still be in discussions with both Northern Rock and potential funding banks as it thrashes out the final details of its offer.

Insiders said that most banks were open to providing finance for any successful bidder for Northern Rock, rather than being locked into one offer.

Olivant’s revised bid comes after revised bids from JC Flowers and Cerberus, the American private equity firms in spite of Virgin Group being announced as the preferred bidder. Furthermore, Bryan Sanderson, Northern Rock’s chairman, described the Virgin deal as ‘very good news’ for the bank.

Sources say the Treasury is not in favour of making the crisis-torn bank insolvent or nationalising it but they would like it to be resolved quickly but they need to ensure that they get the right deal.

In the meantime, Northern Rock’s 6,000 employees have been given a £200 bonus as well as a 4% salary increase which is said to have outraged its customers who called the pay rises ‘disgraceful and entirely inappropriate’.

A spokesperson for Northern Rock described the 2% bonus as a ‘thank-you for all their hard work.

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