Goldman Sachs employed to assist with rescue of Northern Rock

According to a UK Treasury spokesman, Goldman Sachs, the US investment bank, has been called in to use its global reach to help put in place a financing package to rescue crisis-torn Northern Rock.

The spokesman said the package would be available to any buyer and that the 2 main bidders, Virgin Group and Olivant, would be treated equally.

Last week, Olivant run by Luqman Arnold, said it would remain in talks to buy Northern Rock after being informed that it would be treated on a equal basis to Sir Richard Branson’s Virgin Group.

There were concerns that Olivant would pull out to leave just one interested suitor and news of a £281 million hit to profit from its exposure to the credit crunch sent shares in Northern Rock plummeting 13% on Thursday.

Virgin has been the preferred bidder from the offset and talks have increased but Olivant will now be treated on an equal footing in all respects, including gaining access to banks providing financing for a deal.

Both Virgin Group and Olivant are struggling to find the financing to take over the bank and repay £25 billion of tax payer-backed loans.

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