The UK-based Metro Bank PLC (GB:MTRO) share price surged over 6% after the shareholders gave a green light to its rescue deal. The approval came after the bank revealed a funding deal last month, which included a £325 million capital raise and debt financing of £600 million. Yesterday, over 90% of shareholders in the bank voted in favor of the equity raise. The bank stated this support as “overwhelmingly,” even though the cash call will significantly dilute shareholders’ investments in the bank.
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Under the terms of the rescue deal, Jaime Gilinski Bacal, Metro Bank’s largest shareholder, is poised to inject £102 million of new equity. Spaldy Investments, Bacal’s entity, will increase its stake from the current below 10% to 53%, establishing itself as the majority shareholder.
In separate news, Metro Bank is currently in talks to sell a sizable £3 billion mortgage portfolio to Barclays PLC (LON:BARC) as part of its restructuring strategy. This initiative is part of the bank’s efforts to strengthen its balance sheet and overall financial health.
Metro Bank offers a wide range of banking and financial solutions in the UK. The bank’s primary emphasis is on serving retail customers and addressing the requirements of small to medium-sized businesses.
Metro Bank Share Price Forecast
The Metro Bank share price gained 6.62% yesterday after the announcement of the news. Continuing its gains, the stock is trading up by 1.71% today at the time of writing. The bank’s stock is experiencing significant volatility, with a notable decline of approximately 60% in its value over the past three months.
Overall, MTRO stock has received a Moderate Sell rating on TipRanks, based on one Sell recommendation from Barclays. The Metro Bank share price target is 70p, which implies a change of almost 70.5% from the current level.
