Tuesday, December 08, 2009

Northern Rock Shareholders To Receive Nothing

Andrew Caldwell, the BDO valuations partner, has issued a consultaiton document outlining his provisional views on the Northern Rock valuation, and on the amount of any compensation that may be payable to former shareholders.

Former shareholders, seemingly, can expect to receive nothing.

Shareholders have, since the inception of the valuation exercise, argued that treating Northern Rock as if it were not a going concern (before the government rescue) would quite clearly result in a zero valuation on their shares.

Whilst their anger may be understandable, if Northern Rock were a going concern at that time why did it need government help and would it have survived without it?

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