NatWest reported its purchase of 549,851,147 ordinary shares from Her Majesty’s Treasury (HMT), which has brought HMT’s voting rights in the bank below 50%.
The Treasury will have an estimated 48% of NatWest’s voting rights remaining once the transaction is completed.
The shares were bought for 220.5p per ordinary share at the 25 March closing price on the London Stock Exchange.
The complete consideration for the purchase will amount to £1.2 billion and is projected for settlement on 30 March 2022.
The purchased ordinary shares represent a reported 4.9% of NatWest’s issued share capital, excluding treasury shares.
The result of the deal will see NatWest hold 146,116,846 of its Ordinary Shares as treasury shares, alongside 10,650,979,374 Ordinary Shares, 483,140 Cumulative Preference Shares worth £1 and 10,130 Category II Non-cumulative Preference Shares worth 0.1c issued.
“We believe this transaction to be a good use of capital for the bank and our shareholders,” said NatWest CEO Alison Rose.
“Reducing government ownership below 50% is an important milestone for NatWest Group and a further demonstration of the progress we are making as we continue to deliver for our customers and shareholders.”
Analysts shared comments on the timeframe for NatWest’s return from the financial crisis in 2008.
“NatWest Group has reached a milestone with the UK government’s stake in the bank peeled back to below 50% since the first time since the financial crisis,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.
“It’s been a long road back from emergency purchase of the beleaguered Royal Bank of Scotland group, with a re-brand, and the step by step repurchase of the government holdings.”
“This is the fifth sale, returning £1.2 billion to treasury coffers, at a time when the government sorely needs the cash with the costs of borrowing mounting.”
NatWest shares were up 2% at 225p per share in late morning trading on Monday.