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PM confirms ongoing talks for private takeover of N Rock

19/01/2008

Prime minister Gordon Brown has confirmed that talks looking into a private takeover of troubled lender Northern Rock are underway.

Mr Brown made the announcement to reporters during his trip to China; a few days after the opposition accused him of taking too long to tackle the problems posed by the collapse of the mortgage specialist.

During prime minister's questions, he insisted that the government had acted quickly to ensure financial stability in the system.

Speaking in Shanghai, the prime minister said investment bank Goldman Sachs had been hired to look into measures to solve the financial problems faced by Northern Rock, which has received over £50 billion in assistance from the government.

Mr Brown added that chancellor Alistair Darling would issue a statement to parliament on Monday regarding measures to be taken to secure the firm.

The prime minister has previously refused to rule out nationalising the firm and has emphasised that all options on its future were being considered. Analysts have interpreted the announcement as a blow to nationalisation and an indication that a takeover of the private firm was likely.

Previously, Virgin owner Sir Richard Branson has expressed an interest in incorporating the bank into the financial services branch of his company.