THE four rebel shareholders that backed a failed attempt to take control of Bradford & Bingley (B&B) have pledged to salvage the troubled bank’s fundraising deal.

Standard Life, Legal & General, M&G and Insight were the key backers of Clive Cowdery’s efforts to put together a rival fundraising for the bank.

The plans fell apart on Friday after the B&B board refused to open its books - a move that sparked anger among shareholders. Although the four institutions still object to the terms of a £400m fundraising agreed with Texas Pacific Group, they have told B&B they will ensure the deal is voted through at a shareholder meeting in eight days.

Even Cowdery has told the B&B board he will vote his 2.9% share in favour of the Texas Pacific deal.

The move comes amid fears that angry shareholders will block the Texas Pacific deal in protest at the board’s behaviour - pitching B&B’s future back into doubt.

The UK Small Shareholders Association is considering advising its members to block the deal. Britain’s most powerful investor lobby, the Association of British Insurers (ABI), is calling on its members to turn out in person for the B&B ballot, in a move that threatens to push the vote to the wire.

The ABI has already issued an “amber” alert to its members over corporate-governance concerns raised by the deal.

Peter Montagnon, the ABI’s head of investment services, said: “It is unfortunate that the board of Bradford & Bingley did not decide to open the books when there was a chance for shareholders to have a choice.”

There are also concerns that hedge funds could attempt to hijack the vote if they think there is a prospect of Cowdery returning with a better offer.

New York-based Bridger Management became the latest investor to disclose a short position on B&B’s shares on Friday night. The fund, run by Robert Mignone, who has made donations to the presidential campaign of John McCain, disclosed a 0.35% short position. Bridger said it has held a short position above 0.25% since October.

The disclosure follows new rules introduced by the Financial Services Authority that force funds to reveal short positions in companies making rights issues.

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