(Adds FirstRand's confirmation of takeover approach in first paragraph)
FirstRand Ltd. (FSR.JO) on Friday confirmed that it has approached London-listed challenger bank Aldermore Group PLC (ALD.LN) over a possible takeover, with the news coming after Aldermore shares rose by as much as 20% earlier in the day on the bank's announcement that it had received an offer.
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South Africa-listed FirstRand said the potential acquisition is part of its strategy to grow and diversify the revenue of its U.K. business.
FirstRand is offering Aldermore 313 pence per ordinary share in cash.
Aldermore's board has indicated to FirstRand that it is likely to recommend a firm offer at this level.
The two companies are in preliminary discussions about the details of the offer, Aldermore said. In accordance with the City Code on Takeovers and Mergers, FirstRand has until 1700 GMT on Nov. 10 to announce its firm intention to make an offer, Aldermore added.
Shares in Aldermore were up 45.90 pence, or 18%, to 301.90 pence and shares in FirstRand were down 2.15 South African cents, or 0.7%, to 301.84 cents at 1252 GMT.
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(END) Dow Jones Newswires
October 13, 2017 09:51 ET (13:51 GMT)