As previously announced by the Company, the buyback programme will be in addition to the payment of a proposed €122 million cash dividend to all shareholders.
The Minister has confirmed that he will participate in the programme on a proportionate basis in order to avoid the State’s percentage shareholding in AIB increasing from its current level of just under 70%. The directed buybacks are expected to take place on a daily basis using the relevant closing price, and the aggregate amount to be paid to the State is expected to be approximately €64 million.
The Minister also retains the discretion to agree directed buybacks of a greater amount that would reduce further the Minister’s shareholding in the Company, subject to the aggregate amount of the share buyback programme not exceeding €91 million.
In announcing the transaction, the Minister for Finance commented:
“Participating in this buyback programme on a proportionate basis is a positive step both for AIB and the State, as its largest shareholder, and will enable us to recover more money for citizens. When combined with the annual dividend, the State expects to receive a total of approximately €149 million from the Company, which will be returned to the exchequer and used for productive purposes.”
The Department of Finance was advised by N.M. Rothschild & Sons Limited and William Fry LLP in relation to this transaction.
