Updated at 1.20pm
THE STATE HAS sold approximately 28.75% of its shares in AIB for €3.4 billion, Minister for Finance and Public Expenditure Paschal Donohoe confirmed this afternoon.
The flotation of AIB shares is the largest flotation in Europe this year.
Shares began trading at 8am this morning. They sold for €4.40 each.
Shares were purchased by 350 different financial institutions, with 10% of shares allocated to ordinary investors.
Three quarters of the shares overall are being held by sovereign wealth or long-term investors, Donohoe said, with a “large concentration” of these being in the US and UK.
The state now has an option to sell a further 3% stake in the coming weeks, which would raise a further €400 million.
The transaction valued the bank at €12 billion.
Donohoe did not rule returning to Cabinet to receive backing to sell further stakes in AIB if the opportunity arises.
I am bound by the Programme for Government and [it] makes very clear that we can sell 25% of a bank, plus a transaction on top of that in case we need to make decisions in relation to the stabilisation of the price.
If opportunities were to occur that I believe offered long-term value for the tax payer, I would go back to cabinet and present options to them in relation to that.
He said that this transaction shows a clear pathway exists to the Irish taxpayer and citizen to “regaining back all of the money that went into supporting AIB”.
Our country has gone through such a difficult path in relation to stabilising the Irish economy and moving it to recovery. The status of the Irish banking system, and all that needs to be done to support it, was at the very heart of that and at times called for much justifiable anger for the taxpayer.
Speaking this morning, Donohoe said:
“The successful completion today of AIB’s IPO represents a significant milestone in the Government’s long-held policy to dispose of our banking investments, returning them to the private sector over time. The offer was very well received and attracted high demand from investors everywhere it was marketed, reflecting the strength of AIB’s investment story and prospects, and the attractions of Ireland’s vibrant and growing economy.
“This successful IPO has created a strong platform for the State to recover all the money it has invested in AIB and to further dispose of our banking investments for the benefit of the Irish people.”
The government had owned a 99.9% ownership of Allied Irish Banks.
AIB received the biggest bailout of all the Irish banks still trading, with the government injecting €21 billion into the bank during the financial crisis.
With reporting by Paul Hosford
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