LONDON: The seventeenth century adage 'Who won't be ruled by the rudder must be ruled by the rock' has never been more true than today when it emerged that a consortium 'led' by Sir Richard Branson's Virgin Group is now 'preferred bidder' for moribund UK mortgage bank Northern Rock.

While the rudder of rationality suggests short-term nationalisation as the only route likely to benefit both savers and the British government - which has allegedly poured up to £40 billion of taxpayer's money into the sagging business - the rock of the easy option appears set to win the day.

According to the Wall Street Journal, that option will be formally announced today, Monday.

However, the serious money will come not from Virgin but from US investors such as AIG Financial Products and corporate-restructuring specialist W L Ross & Company.

The consortium would take control of the bank via a purported 'rights issue', with shares gifted to the alliance at a fraction of the price at which they have traded over the past several days.

The Branson-fronted Wall Street brigade would gain control of more than 50% of the bank while existing shareholders watch the value of their holdings diminish to somewhere near zilch.

In return for this manna from heaven, on inking the deal the moneymen will repay "some" of the £23 billion-plus ($47.29bn; €312.90bn) already borrowed by the Rock, both from the Bank of England and from elsewhere on the strength of government-underwritten guarantees.

Exactly how much will be repaid initially remains, at the moment, conveniently fuzzy, but insiders say the residual debt will be repaid over about three years - subject always to crossed-fingers behind backs.

Branson wants to rename the bank Virgin Money, after a small financial company in his joint ventures stable. The resultant publicity for this otherwise insignificant firm is, some observers believe, the main motivation for Sir Richard's involvement.

Northern Rock shares have lost more than 90% of their value this year.

Data sourced from Wall Street Journal Online. additional content by WARC staff