Tuesday 30th January 2007
Financial services provider Prudential has announced the sale of its credit-lending subsidiary Egg Banking, which also provides personal loans and mortgages, to credit card provider Citigroup.
Through an agreement built into the deal, Prudential says it will retain access to Eggs distribution model for the provision of life insurance and pensions to Egg customers.
Mark Tucker, group chief executive of Prudential, said: "The sale of Egg to Citigroup realises greater value for our shareholders than retaining the business within the group.
"Citigroup is the largest credit card issuer in the world and sees enormous opportunities to develop Eggs business in the UK."
The agreement to continue supplying Prudential services to Eggs customer base extends for a period of five years following the acquisition, the company stated.
In total, Citigroup is expected to pay £575 million in cash, subject to any change in assets and the deal is scheduled to close before the end of April 2007.
Egg is currently offering its Egg Money prepaid package which provides one per cent cashback on all outgoing spending.
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With a combination of competitive rates and funky branding, Egg have established themselves as one of the biggest credit cards in the UK. They are one of the most competitively priced cards on the market.
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