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September 15, 2022updated 16 Sep 2022 11:58am

Plans to sell UK challenger bank Shawbrook for £2bn dropped

By Shivam Mishra

Private equity owners of UK-based asset finance provider Shawbrook have dropped plans to sell the challenger bank, the Financial Times reported citing four unnamed sources. 

The decision by BC Partners and Pollen Street Capital comes after they could not attract bids worth £2bn for the lender. 

International investors are cautious about investing in the UK market due to the uncertain political landscape and soaring inflation, the sources said, adding that volatile markets and a wider fall in dealmaking activity have also affected the sale. 

It was not immediately clear when Shawbrook will be put up for sale again, a source said, while another said it could take up to 18 months before the sale is reinitiated. 

British private equity firms were also considering an initial public offering for the bank, but that plan has also been called off. 

The development comes as the UK economy combats the worst inflationary forces in four decades and it could fall into a recession. 

“If you are looking at the UK from the outside, you are pausing now,” one of the sources said.

Shawbrook is engaged in providing property finance, business finance, consumer lending and savings services. 

In 2017, Shawbrook Group was acquired by BC Partners and Pollen Street Capital in a public-to-private transaction. 

Shawbrook and its owners declined to comment on the development.

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