AIB Group has confirmed the Irish Department of Finance’s latest sell-down of its stake in the bank, reducing the state’s shareholding from 17.5% to approximately 12.5% through a €652m transaction.
The government divested 116 million ordinary shares, representing 5% of AIB’s issued capital, through a placement to institutional investors. The shares were sold at €5.6 each.
Irish Finance Minister Paschal Donohoe said: “It is now a realistic target that the state could exit its position in AIB later this year should market conditions allow.”
This latest transaction is reported to have secured a price 14% higher than the previous AIB sale in June 2023.
AIB Group CEO Colin Hunt said: “2024 was the first year of our new strategic cycle and we made strong progress in each of our three focus areas: Customer First, Greening our business and Operational efficiency.
“Our business performance is underpinned by a supportive domestic economy, our leading customer franchise, competitive market positioning, growing loan book and resilient and diversifying income. We look forward to continuing to support our customers, generating shareholder value and delivering our 2024 Annual Financial Results on 5 March.”
Ireland effectively nationalised AIB in 2010 after injecting €21bn as part of a €64bn bailout of the country’s banks following the financial crisis.
To date, the government has recouped €17.9bn from its investment in AIB. The latest share sale forms part of its ongoing strategy to gradually reduce public ownership of the bank, following AIB’s initial public offering in 2017.
The proceeds from the transaction will be directed to the Ireland Strategic Investment Fund.
BNP Paribas, BofA Securities Europe, Goldman Sachs International, and Goodbody Stockbrokers acted as joint bookrunners for the placement, while N.M. Rothschild & Sons served as the government’s independent financial adviser.
Legal counsel was provided by William Fry and Allen Overy Shearman Sterling.
In addition, the Department of Finance has agreed to a 90-day lock-up period, during which no further AIB shares will be sold without the consent of the joint bookrunners.
Ireland completed its exit from AIB’s main rival, Bank of Ireland, in 2022. It has also indicated that it may fully divest its remaining stake in AIB by the end of the year.
