Virgin Money, the British challenger bank founded and partly owned by entrepreneur Richard Branson, said it plans to raise £150 million (€192 million) from a stock market listing in London.

Branson’s Virgin Group and WL Ross, a US-based investment vehicle, collectively own just over 90 per cent of Virgin Money.

Virgin said on Thursday those two and other shareholders and employees will also sell shares in the offer so that the free float of the company will be at least 25 per cent when it lists.

Analysts have estimated the company could be valued at between £1.5 billion and £2 billion, indicating that more than £375 million of new and existing shares will be sold in total in the offer.

Virgin said the £150 million of new shares it sells will support its growth and boost its capital strength.

The company will also pay £50 million to the UK Treasury on completion of the offer, under the terms of its purchase of nationalised lender Northern Rock in 2011.

Virgin Money is based in Newcastle, the former home of Northern Rock, and employs 2,800 people and has 2.8 million customers. It said each member of staff will be given £1,000 of shares when the company lists.

Reuters