The effort to sell Atom Bank is close to being abandoned after the process failed to produce offers matching the £600m valuation sought by its shareholders, reported The Financial Times.
Sources told the publication that investors in the Newcastle lender, among them BBVA of Spain and asset manager Toscafund, are weighing whether to stop the sale because buyer interest has been limited.
Pollen Street Capital submitted an offer for Atom, but the proposal was below the price expected by sellers, the same people said.
They added that a materially higher bid from Pollen Street was not expected.
Had Pollen Street succeeded, the deal could have led to Atom being combined with Tandem, a separate digital bank already under its ownership.
If the sale does not proceed, pressure is likely to grow on Atom’s leadership. Two people familiar with the discussions said some shareholders would seek management changes if no purchaser emerged.
Those changes could extend to chief executive Mark Mullen, who has been in charge for 12 years, the report said.
The sources added that Yorkshire Building Society and Leeds Building Society also looked at possible offers for Atom, which serves 250,000 customers, but chose not to take matters further.
Several other banks also examined the business and decided against bidding.
Atom, founded in 2014, employs 600 people and was one of the first UK app-based banks to operate without branches.
The attempt to secure a £600m valuation follows a fundraising last year that valued the business at £350m, compared with £459m in 2022.
Since 2021, the company has allowed employees to work a four-day week on full pay. Its past shareholder base also included Neil Woodford through Woodford Investment Management.
Atom had earlier planned to seek a stock market listing but delayed that route several times before turning instead to a sale.
“Atom Bank sale may be halted after weak bids – report ” was originally created and published by Retail Banker International, a GlobalData owned brand.