Atom Bank sale process nears collapse amid weak £600mn bid interest

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Atom Bank sale process stalls

Highlights

Atom Bank's sale process is near collapse as Pollen Street Capital's bid fell short of the £600mn target valuation and is unlikely to be raised.
Yorkshire Building Society, Leeds Building Society, and several other banks reviewed Atom Bank but ultimately decided not to make bids.
Shareholder pressure is increasing on Atom Bank's management after the failed sale, as pre-tax profit fell to £5.1mn from £6.7mn, with £4.2bn in mortgage balances and £7.5bn in customer deposits.

Sale process stalls as bids fall short

As first reported by Financial Times, Atom Bank’s shareholders are considering halting the sale after the auction failed to attract offers at the price they were seeking. People familiar with the matter say private equity group Pollen Street Capital submitted a bid, but the offer was below the target valuation and is unlikely to be raised significantly.

A takeover by Pollen Street could have led to a merger between Atom and Tandem, another digital lender already owned by the buyout group. Yorkshire Building Society and Leeds Building Society also considered potential bids, the people say, but ultimately chose not to pursue a transaction, while several other banks reviewed Atom and decided not to bid.

Atom Bank, BBVA, Toscafund and Pollen Street decline to comment. Leeds Building Society also declines to comment, while Yorkshire Building Society does not immediately respond to a request for comment.

Shareholder pressure grows over strategy and performance

Failure to find a buyer is likely to intensify scrutiny of Atom’s leadership, with some shareholders expected to push for a management shake-up, according to two people familiar with the matter. Possible changes include the departure of chief executive Mark Mullen, who has led the company for 12 years, although one person close to the bank says he retains the support of many large shareholders.

Founded in 2014, Atom was among the UK’s first branchless digital banks and now has 250,000 customers and about 600 employees. Unlike app-focused neobanks, it has built a more conventional banking model around savings and mortgages, but it still trails larger fintech rivals such as Revolut and Monzo in customer scale.

The attempted £600mn sale comes after a fundraising round last year valued the business at £350mn, down from £459mn in 2022. Latest accounts filed at Companies House show Atom generated £5.1mn in pre-tax profit in the year to March 2025, down from £6.7mn a year earlier, with £4.2bn in mortgage balances and £7.5bn in customer deposits.

UK mortgage approvals and consumer borrowing trends were the focus of our earlier coverage, highlighting a sharp drop in approvals to the lowest level since December 2023 alongside softer unsecured lending. We noted that higher mortgage rates and weaker confidence were weighing on housing demand, increasing pressure across the property and mortgage market.

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