Ailing British bank Northern Rock appears unlikely to be able to stop demands by shareholders to hold an emergency meeting on its sale process next month.
A spokesman for RAB Capital, one of two hedge funds to have called on Northern Rock to convene an EGM, said today it still wants such a meeting to be held.
RAB and SRM Global Fund, Northern Rock's two biggest investors with a combined stake of over 16 per cent, last month called for the bank to hold an EGM to amend its articles of association so that shareholders would have to approve the disposal of more than 5 per cent of its assets.
The EGM could prove to be an embarrassing public face-off for Northern Rock. RAB and SRM are likely to be joined by some of the estimated 140,000 small shareholders in the bank, many of whom have opposed the sale process.
Northern Rock needs to make a decision on the EGM by Monday.
A meeting would likely be called for mid-January, just when the auction of the bank is expected to be coming to a head. Northern Rock is seeking a rescuer after it became Britain's highest profile casualty of this year's global credit crisis.
It has had to borrow at least £25 billion from the Bank of England since its funding crisis erupted in September.
A consortium led by Virgin Group and investment group Olivant are in talks with Northern Rock's advisers and the Treasury