The Northern Echo- HIGH street lender Northern Rock saw its share price surge by more than a quarter yesterday after it emerged a Monaco hedge fund had amassed a four per cent stake in the business.<\/p>\n
The revelation that SRM Global had built up a stake in the Newcastle-based lender encouraged hopes of a rescue for the group, which was forced to seek emergency funding from the Bank of England last month.<\/p>\n
The news comes only days after Northern Rock extended funding guarantees from the Treasury to cover the deposits of new savers, amid reports of potential interest from private equity bidders – including alleged front-runner JC Flowers – and a \u00c3\u201a\u00c2\u00a310bn loan for the company from Citigroup.<\/p>\n
Northern Rock’s share price surged 32 per cent yesterday, less than two weeks after reaching an all-time low of 132.1p, and closed last night at 273\u00c3\u0192\u00e2\u20ac\u0161\u00c3\u201a\u00c2\u00bdp, its highest level for over three weeks, returning the company to a stock market value of more than \u00c3\u201a\u00c2\u00a31bn.<\/p>\n
SRM Global, which paid 199p a share for the latest addition to its holding yesterday, declined to comment.<\/p>\n