UK Government Sells £1 Billion Stake in NatWest Group Through Off-Market Purchase

November 11, 2024 06:54 PM AEDT | By Team Kalkine Media

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UK Government Sells £1 Billion Stake in NatWest Group Through Off-Market Purchase — Image source: shutterstock

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Highlights

His Majesty’s Treasury (HM Treasury) sold approximately 262.6 million shares in NatWest Group at 380.8 pence each, generating £1 billion.

Following the transaction, HM Treasury’s voting rights in NatWest will decrease from 14.2% to 11.4%.

The UK Government will continue to monitor market conditions to evaluate further NatWest share disposals when financially advantageous.

UK Government Investments (UKGI) announced the successful completion of the disposal of a portion of His Majesty’s Treasury's shareholding in NatWest Group plc (LSE:NWG). The sale, completed via an off-market purchase, reduced HM Treasury’s stake in the bank and generated £1 billion in proceeds.

The transaction involved the sale of 262,605,042 NatWest ordinary shares, as stipulated in the Directed Buyback Contract initially signed in February 2019 and subsequently amended in November 2022 and May 2024. NatWest shareholders reapproved the contract at the April 2024 Annual General Meeting, allowing the bank to execute the off-market share repurchase. Under this agreement, NatWest paid 380.8 pence per share, reflecting the closing share price on November 8, 2024, on the London Stock Exchange.

Following the cancellation of the repurchased shares, HM Treasury’s voting rights in NatWest will decrease from 14.2% to 11.4%. Settlement of the transaction is scheduled for November 13, 2024.

The sale aligns with the government’s strategy of gradually reducing its stake in NatWest, following the 2021 announcement of a trading plan aimed at offloading shares while maintaining market stability. This trading plan, most recently extended in April 2023, remains active, with Morgan Stanley & Co. International plc managing its execution. UKGI and HM Treasury will continue to evaluate opportunities for further disposals based on favorable market conditions and value considerations.

Goldman Sachs International served as the Privatisation Adviser for this transaction, while Freshfields Bruckhaus Deringer LLP provided legal counsel on English and US law.

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