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Northern Rock Shares - No Value?

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So presumably the same will apply to my B&B shares.

Probably!

NR were broke long before Mr Darling nationalised then (oops sorry, took them into Temporary Public Ownership!)

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If ever there was a lost cause, this has to be it!

The Hedge Funds are keeping at it which just encourages all those private shareholders to follow on in the mistaken belief that they are going to get something for all those worthless bits of paper that say "Northern Rock Ordinary Share" on them!

What a total waste of time and resources!

Edited by topliner

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If ever there was a lost cause, this has to be it!

The Hedge Funds are keeping at it which just encourages all those private shareholders to follow on in the mistaken belief that they are going to get something for all those worthless bits of paper that say "Northern Rock Ordinary Share" on them!

What a total waste of time and resources!

I find it quite hard to care about filthy rich people losing some of their millions. They must have plenty left if they can afford this legal action.

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I find it quite hard to care about filthy rich people losing some of their millions. They must have plenty left if they can afford this legal action.
Who do you think are the biggest investors in hedge funds. Public sector pensions....... people like CALPERS. It's not all about superrich overlords, whatever you may have been conditioned to think.

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http://business.timesonline.co.uk/tol/busi...icle6730164.ece

This article mentions Dennis Grainger 62 (a former NR employee) who heads up the NR Shareholders movement. This is the guy who was on the Telly complaining that he had lost his life savings in NR shares.

I found out which department he worked in... Finance!

It begs the question... why did he have all his eggs in one (NR) basket?

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The shareholders are right. They should have got the chance to realise value in the market, under a normal sequence of events:

  1. Bank finds itself bust.
  2. Bank MAY get a takeover bid as a going concern (NR did - shareholders would indeed have got something if government hadn't blocked it).
  3. If not, bank goes into receivership
  4. Administrators seek best price for the assets.
  5. Creditors are paid off at whatever rate the assets support.
  6. If there's anything left, shareholders get it (there almost certainly wouldn't have been in NR's case).

The dispute is over the difference between (2) and (6). In the light of subsequent events, it would've been better all round if LloydsTSB's bid had been allowed to go ahead. Well, except for HBOS shareholders, who would've missed out on their bailout if LloydsTSB was already digesting one basketcase (but much better for Lloyds shareholders to take on a millstone of manageable size).

[edit to add] p.s. I never held Northern Rock shares. Nor even a few quid in an account with them.

Edited by porca misèria

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The shareholders are right. They should have got the chance to realise value in the market, under a normal sequence of events:
  1. Bank finds itself bust.

  2. Bank MAY get a takeover bid as a going concern (NR did - shareholders would indeed have got something if government hadn't blocked it).

  3. If not, bank goes into receivership

  4. Administrators seek best price for the assets.

  5. Creditors are paid off at whatever rate the assets support.

  6. If there's anything less, shareholders get it (there almost certainly wouldn't have been in NR's case).

The dispute is over the difference between (2) and (6). In the light of subsequent events, it would've been better all round if LloydsTSB's bid had been allowed to go ahead. Well, except for HBOS shareholders, who would've missed out on their bailout if LloydsTSB was already digesting one basketcase (but much better for Lloyds shareholders to take on a millstone of manageable size).

of course the shareholders are right, but this is a stitch up. The government CANNOT allow them to win - same as Railtrack - that the government also trashtalked to oblivion and then failed to pay up properly for.

And if LTSB had bought NRK before it all went wrong, they'd not have bought HBOS .... which I am sure they now wish they'd not....

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My dad was one of those people who never owned any shares, until a few little windfall sets. I think NR were some that came his way "for nothing". Last time I visited him he was still holding onto them thinking they'd be worth something, I stayed quiet.

His attitude though will be: "You can't miss what you never had"

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The shareholders are right. They should have got the chance to realise value in the market, under a normal sequence of events:
  1. Bank finds itself bust.

  2. Bank MAY get a takeover bid as a going concern (NR did - shareholders would indeed have got something if government hadn't blocked it).

  3. If not, bank goes into receivership

  4. Administrators seek best price for the assets.

  5. Creditors are paid off at whatever rate the assets support.

  6. If there's anything left, shareholders get it (there almost certainly wouldn't have been in NR's case).

The dispute is over the difference between (2) and (6). In the light of subsequent events, it would've been better all round if LloydsTSB's bid had been allowed to go ahead. Well, except for HBOS shareholders, who would've missed out on their bailout if LloydsTSB was already digesting one basketcase (but much better for Lloyds shareholders to take on a millstone of manageable size).

[edit to add] p.s. I never held Northern Rock shares. Nor even a few quid in an account with them.

Fair points I grant you that Porca. But am I not correct in saying that Branson (Virgin Money) and a sector of NR's own (failed miserably) management team were the last to bid for NRK? They were not prepared to pay enough and that is why it was taken into Temporary Public Ownership.

Watch this space, I bet NRK are sold back into private sector just before the new year! (My prediction)

I did hear that some senior managers were shown the door a few weeks ago...tells you something is going down?

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Fair points I grant you that Porca. But am I not correct in saying that Branson (Virgin Money) and a sector of NR's own (failed miserably) management team were the last to bid for NRK? They were not prepared to pay enough and that is why it was taken into Temporary Public Ownership.

Watch this space, I bet NRK are sold back into private sector just before the new year! (My prediction)

I did hear that some senior managers were shown the door a few weeks ago...tells you something is going down?

Richard Branson wasn't prepared to pay anything for it. He was going to give them the "Virgin Money" trademark, which he said was worth a lot of money, and he wanted the government to lend Northern Rock lots of money.

The government, quite rightly in my opinion, decided that if it was their money that was going into the company, then they should be the ones who owned it, not Lloyds or Virgin.

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Richard Branson wasn't prepared to pay anything for it. He was going to give them the "Virgin Money" trademark, which he said was worth a lot of money, and he wanted the government to lend Northern Rock lots of money.

The government, quite rightly in my opinion, decided that if it was their money that was going into the company, then they should be the ones who owned it, not Lloyds or Virgin.

Actually LTSB had looked at buying NRK before they got into trouble in September 2007, they walked away three times. The hedge Fund mob were trying to buy (probably for very little payment) then along came Virgin Money and of course (biggest joke of all) the NRK management guys!

I think that was the sequence of "bidders"

Any bets on when NRK will be off loaded then? Just for a bit of sport...

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Actually LTSB had looked at buying NRK before they got into trouble in September 2007, they walked away three times. The hedge Fund mob were trying to buy (probably for very little payment) then along came Virgin Money and of course (biggest joke of all) the NRK management guys!

LTSB were rebuffed because they wanted to buy it on the 'quiet' in about March of 2007 - they approached (or were approached by, it's not quite clear) the Treasury who said, do you want it ? LTSB said, why yes, lend us a lot of the money to buy it and we'll have it. This was (and still is) contrary to EU law - so the government said no - yet it was quitehappy to ignore EU law when it suited it. LTSB then came back (as you say) twice more and were twice told to go away, because their argument that they could not borrow the money on the markets to buy it as it would accelerate NRK's problems when it got out (sort of legitimate) was knocked back).

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Fair points I grant you that Porca. But am I not correct in saying that Branson (Virgin Money) and a sector of NR's own (failed miserably) management team were the last to bid for NRK? They were not prepared to pay enough and that is why it was taken into Temporary Public Ownership.

Watch this space, I bet NRK are sold back into private sector just before the new year! (My prediction)

I did hear that some senior managers were shown the door a few weeks ago...tells you something is going down?

Different story with the other bidders: they only appeared after the government had screwed up the market by underwriting it. So then it was into a game of "pay us £££££ to save the egg on your face".

But sure, if it had gone into administration, it's entirely possible that Branson and others would've bid for the assets. I don't really know if LTSB was being cheeky or realistic when it bid for NR; perhaps both!

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Different story with the other bidders: they only appeared after the government had screwed up the market by underwriting it. So then it was into a game of "pay us £££££ to save the egg on your face".

But sure, if it had gone into administration, it's entirely possible that Branson and others would've bid for the assets. I don't really know if LTSB was being cheeky or realistic when it bid for NR; perhaps both!

Don't know the answer to that, however, I bet LTSB chiefs are glad they didn't buy NRK, given the sh1t they are in now! :rolleyes:

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Don't know the answer to that, however, I bet LTSB chiefs are glad they didn't buy NRK, given the sh1t they are in now! :rolleyes:

Read the rest of the thread! Lloyds are in trouble because of HBOS.

NRK was much smaller: a LTSB takeover could've been something more like Nationwide or Santander absorbing smaller institutions in trouble.

Some of us think that with a bout of moderate indigestion from NRK, Lloyds would've steered clear of HBOS, and hence out of serious trouble. Bear in mind that Barclays escaped the government, despite having been in a much worse shape than LTSB when all this started.

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Read the rest of the thread! Lloyds are in trouble because of HBOS.

NRK was much smaller: a LTSB takeover could've been something more like Nationwide or Santander absorbing smaller institutions in trouble.

Some of us think that with a bout of moderate indigestion from NRK, Lloyds would've steered clear of HBOS, and hence out of serious trouble. Bear in mind that Barclays escaped the government, despite having been in a much worse shape than LTSB when all this started.

Have done, I'm not argueing that fact. LTSB could have swallowed NRK back in March 07, why it wanted NRK was to get it off the street, after all NRK was fifth biggest mortgage lender by volume at that time.

Wasn't Barclays at the door of BoE before NRK back in 2007?

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