Kent Reliance Building Society is readying to announce its deal with private equity firm JC Flowers' which is investing £50m to gain a 49% stake in the mutual.
In a story in Mortgage Strategy, legislation that allowed Britannia Building Society and Co-operative Financial Services to combine has paved the way for this new mutual model.
Chief executive Mike Lazenby will stay at the helm of the enlarged firm and Sir Callum McCarthy, former chairman of the FSA, also joins as chairman.
The negotiations, which involved the FSA reportedly went on for around nine months and were made possible by the Butterfill Act.
The deal could pave the way for further recapitalisation deals for other building societies.
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