US firm takes a fifth of B&B stake

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The buy-to-let lender will receive a cash injection of £150 million from Texas Pacific Group after the deal, which will see the US-based firm take a fifth of B&B's shares, according to a BBC report.

The two companies have been locked in negotiations throughout the weekend, sources told the Press Association. The news comes on the back of a day in which B&B announced that its chief executive had resigned due to ill health.

A statement from the bank confirmed that Steven Crawshaw stepped down with immediate effect.

Chairman Rod Kent would assume the position of executive chairman until a replacement to Mr Crawshaw was found, it added.

The bank issued a trading statement, widely reported to include a warning that profits for this year were likely to be lower than analysts' forecasts.

The buy-to-let lender was in the process of raising £300 million from shareholders through a rights issue.

It had offered investors the chance to buy discounted stock at 82p a share, but ahead of the fund raising its share price has tumbled to just 6.25p above this level.

The BBC reported that the price of new shares for TPG and for B&Bs existing shareholders was expected to be just above 50p a share.

It also said that under a radical reconstruction of B&B's business plan, investors would now be asked to provide £250 million of new capital through the rights issue. The shortfall would be filled by a cash injection of £150 million from TPG, the BBC reported.