US-backed team unveil Rock bid

Nov 22 2007 by Graeme King, The Journal

DETAILS of a US-backed bid to take control of Northern Rock emerged late yesterday.

Two major East Coast financiers are backing the team, known as the Tyne Consortium, which also has support from UK executives. As reported in The Journal at the end of last week, self-made entrepreneur Alfred Gooding, from South Wales, is one of those involved.

The consortium is led by Chip Kruger, a partner in a company called Five Mile Capital Partners, and who also has some background in the UK finance world, having previously worked for NatWest.

Five Mile, founded in 2003, has extensive experience of the mortgage and asset-backed lending sector. It is based in Stamford, Connecticut, just outside New York, and has over $2bn of funds under its management.

Mr Kruger is joined by Robert Morris, from Olympus Partners, a private equity firm also from Stamford, which targets middle-market management buyouts and venture capital deals.

Founded in 1988, the company manages more than $3.1bn on behalf of clients including corporate pension plans, public retirement systems and university endowment funds.

Meanwhile, Mr Gooding, 75, who has invested in a series of manufacturing companies over the last 40 years, has been included in the team for his expertise in long-term investment, and safeguarding the interests of employees.

The rest of the team is made up of Bruce Fireman, a past managing director of Investec Securities in London, and a founder of The Independent newspaper, and Christopher Yates, a director of Credit Lyonnais Securities in London.

Sources close to the Tyne Consortium said last night that they believe Northern Rock can return to being a strong, ongoing business, and they want to rebuild it. Their intention is to back the new chairman, Bryan Sanderson, and sort out its current financial problems.

The consortium is known to have put in a proposal to the Northern Rock board last week, ahead of the deadline for bids, and have been speaking to the bank’s advisers again this week. They will be submitting revised proposals over the next few days.