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Flying the Co-op

Junior bondholders who were locked in by the Co-op Bank's 2013 recapitalisation given a chance to sell their stakes
September 2, 2015

Are you a locked-in shareholder of the Co-op Bank? If so, your cell door will unlock on 10 September, when unquoted equity marketplace Asset Match opens an auction for those junior bondholders who had their holdings converted into equity shares in the second-tier bank's 2013 recapitalisation.

These investors, thought to number in the hundreds, will be able to sell down or up their stake. The other buyers will be the institutions and high-net-worth investors on the platform. The auction will run until 17 September, when a pricing algorithm will match buyers and sellers: those buying at or above the determined price will succeed, as will those selling at or below that price.

The question is whether those shareholders should rush for freedom, given the speculation about a merger or possible public offering for the embattled bank. "They may not want to [sell]," said Asset Match's co-chief executive, Iain Baillie, "but it will be nice for them to have the option, and that is what we are trying to deliver."