Redwood Bank prepares for public listing with reverse takeover

The lender’s parent company Redwood Financial Partners has signed a heads of terms agreement for the reverse takeover of R8 Capital Investments which is listed on the London Stock Exchange. 

As part of the plan, R8 will acquire the entire issued share capital of Redwood Financial Partners through a share-for-share exchange. This will give the shareholders of Redwood Financial Partners a majority holding in R8. 

At the same time, R8 will inject money into Redwood Bank as common equity tier 1 regulatory capital. 

The capital is expected to help the lender increase its lending capacity and provide opportunities for diversification. 

Redwood: ‘An exciting day in the bank’s history’

Gary Wilkinson, co-founder and CEO at Redwood Bank, said: “Today is an exciting day in the bank’s history. Completing this transaction would be a major step forward for us, providing an excellent opportunity for Redwood to raise more capital, grow and diversify. 

“I am incredibly proud of what the bank has achieved in the six years since launch, and I am confident about the next stage of our journey. We have an enviable network of intermediary partners, a driven team, and robust infrastructure to maximise future opportunities.” 

John Stobart, legal counsel at Redwood Bank, added: “While this represents a key opportunity for the bank, it remains subject to, amongst other things, definitive terms being agreed and the completion of legal and financial due diligence and regulatory approvals.” 

In the six months to June 2023, the bank’s unaudited figures showed a record profit before tax of £2.8m and a 7.4 per cent growth in its lending book. Its net interest margin also improved from 3.3 per cent to 5.13 per cent compared to the year before.