TIDMALBK
RNS Number : 5373Y
Allied Irish Banks PLC
23 December 2010
For Immediate Release 23 December 2010
AIB - Capital Update
DUBLIN, Ireland (23 December 2010) ("AIB") [NYSE:AIB] - Allied
Irish Banks, p.l.c. ("AIB" or the "Company") has today received
notice that the High Court issued a Direction Order (the "Order")
under the Credit Institutions (Stabilisation) Act 2010 (the "Act")
directing AIB to issue immediately approximately EUR3.7 billion
(net of expenses) of new equity capital ("Capital Increase") to the
National Pensions Reserve Fund Commission ("NPRFC"). The new shares
to be issued to the NPRFC will comprise ordinary shares and
convertible non-voting shares ("CNV shares"), to be issued at a
price of EUR0.3793 per new ordinary share and EUR0.3396 per new CNV
share.
This additional equity will ensure that AIB meets the year-end
regulatory capital requirements of the Central Bank of Ireland. It
is expected that the Capital Increase will be completed shortly. To
facilitate completion before year-end, AIB's shareholders will not
be entitled to subscribe for the new equity and pre-emption rights
will be disapplied. The Order also includes a direction that AIB
increases its authorised share capital and adopts amended articles
of association in place of the existing articles of association of
the Company to give effect to the Capital Increase.
The NPRFC Holding Following the Capital Increase
Pursuant to the Capital Increase, AIB will issue 675,107,845 new
ordinary shares to the NPRFC. Upon closing of the Capital Increase,
and in order to facilitate the ongoing disposal of AIB's Polish
interests, the NPRFC will hold 49.9% of the ordinary shares of the
Company, representing 876,220,621 ordinary shares. Following the
Capital Increase AIB will have a total number of 1,755,953,148
ordinary shares in issue. In addition, AIB will issue to the NPRFC
a further 10,489,899,564 CNV shares, which will rank pari passu
with the ordinary shares other than in respect of voting, and will
be convertible into ordinary shares on a one-for-one basis. The
NPRFC intends to increase its holding in AIB's ordinary shares by
converting all of the CNV shares following completion of the sale
of AIB's Polish interests. This would increase the NPRFC's
ownership of the ordinary shares of the Company to 92.8%.
Further Capital Measures to be Undertaken by AIB
Pursuant to the Capital Increase, AIB will receive net proceeds
of approximately EUR3.7 billion and will be required to generate
approximately EUR6.1 billion of additional equity capital in order
to meet its revised PCAR equity capital requirement of EUR9.765
billion, as announced on 28 November 2010. AIB is considering a
number of options to fulfill this requirement prior to 28 February
2011, including the possibility of issuing further new shares to
the State and undertaking liability management exercises in
relation to its subordinated capital.
Preference Shares
It is also anticipated that prior to 28 February 2011, subject
to receipt of appropriate authorities, the NPRFC will convert up to
EUR3.5 billion of its existing 2009 Preference Shares into ordinary
or CNV shares at a price of EUR0.342 per share.
Delisting from the Official List and Main Market of the London
Stock Exchange and Move to the Enterprise Securities Market of the
Irish Stock Exchange
The High Court has directed AIB to apply to cancel its listing
of ordinary shares on the Main Securities Market of the Irish Stock
Exchange ("ISE") ("Irish Main Market Delisting") and to apply for
admission to trading on the Enterprise Securities Market ("ESM") of
the ISE.
The High Court has also directed AIB to apply to cancel the
admission of its ordinary shares to the Official List maintained by
the UK Financial Services Authority and to cancel trading on the
main market of the London Stock Exchange ("LSE") ("UK
Delisting").
The Capital Increase by year-end is, in the opinion of AIB's
Board of Directors, critical for the continued activities of the
Company and cannot be fully completed while AIB remains listed on
the main markets of the ISE and LSE. Given the current financial
position of AIB, the Capital Increase is required to ensure that
AIB complies with the minimum regulatory capital requirements of
the Central Bank of Ireland at 31 December 2010. Failure to
complete the transaction prior to year-end would likely prompt
further action from the Irish State, including the possibility of
full nationalisation. As a result, the Company believes that
cancellation of the main market listings is in the best interests
of AIB and its stakeholders as a whole.
The Company and the State wish to ensure that shareholders
retain access to a public trading facility for their shares.
Shareholders' ownership of the existing ordinary shares will be
unaffected by this move. The Company will advise all shareholders
of this move to the ESM in a letter to be sent to shareholders by
year-end. In the meantime, information in the form of questions and
answers will shortly be made available on the Company's investor
relations website.
The proposed admission to trading on the ESM will mean that AIB
will continue to have market oversight, disclosure and reporting
obligations. It will also facilitate AIB's intention to maintain
investor relationships and market analyst coverage.
The ordinary shares will continue to trade on the ISE up to and
including 25 January 2011. It is expected that the Company will be
delisted from the Main Securities Market of the ISE following the
close on 25 January 2011, being 20 business days from the date of
this announcement and that the Company currently expects to be
admitted to trading on the ESM on 26 January 2011.
Given the timetable for the Capital Increase, the Company will
not therefore seek shareholder approval for the UK Delisting in
reliance on UK Listing Rule 5.2.7. The Company's ordinary shares
will continue to trade on the LSE up to and including 25 January
2011. Following the UK Delisting, the Company's ordinary shares
will trade on the ESM.
The Sale of AIB's Polish Interests
In the Order, the High Court has directed AIB to complete the
sale of its Polish interests to Banco Santander S.A. pursuant to
the Share Purchase Agreement dated 10 September 2010 when all the
regulatory conditions other than the approval of AIB's shareholders
have been satisfied, but not before the admission to trading on the
ESM and the UK Delisting have occurred. As a result, there will not
be a requirement for shareholder approval, an associated circular
or an extraordinary general meeting in order to complete that
sale.
Cancellation of NPRFC Warrants
In connection with the Capital Increase, the Company has agreed
with the Minister and the NPRFC that the 294,251,819 warrants to
subscribe for ordinary shares in AIB, granted to the NPRFC as part
of the Government's 2009 EUR3.5 billion recapitalisation, are to be
cancelled in consideration of the payment of approximately EUR52.5
million by AIB to the NPRFC.
The AIB Board of Directors
AIB's Board of Directors acknowledges the continued support of
the Minister for Finance and the Irish State. It notes its new duty
under the Act to have regard to the public interest in the
performance of their functions and, if that public interest
conflicts with the best interests of the Company, that the new
statutory requirement provides for the public interest to
prevail.
- ENDS -
For further information, please contact:
Alan Kelly Catherine Burke
General Manager, Corporate Head of Corporate Relations
Services and Communications
AIB Group AIB Group
Dublin Dublin
Tel: +353-1-6412162 Tel: +353-1-6413894
email: alan.j.kelly@aib.ie email: catherine.e.burke@aib.ie
IMPORTANT INFORMATION
This is not a prospectus, circular or other equivalent document.
You should not rely on any information as set out in this
announcement. This announcement does not constitute an offer to
purchase or a solicitation of an offer to sell securities, nor
shall there be any sales of these securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities law of such
jurisdiction. No ordinary shares or CNV shares have been marketed
to, nor are any available for purchase in whole or in part by, the
public in Ireland, the United Kingdom or elsewhere in connection
with the Order, the Capital Increase, Irish Main Market Delisting,
UK Delisting or AIB's application for admission to the ESM (the
"Admission").
The contents of this announcement and the information
incorporated herein by reference should not be construed as legal,
business investment, accounting, tax or other professional advice.
This announcement is for your information only and nothing in this
announcement is intended to endorse or recommend a particular
course of action.
It is anticipated that Morgan Stanley & Co. International
plc will act as ESM adviser to AIB and Morgan Stanley Securities
Limited (together with Morgan Stanley & Co. International plc,
each of which is authorised and regulated in the United Kingdom by
the Financial Services Authority) ("Morgan Stanley") will act as
corporate broker to AIB in relation to the Admission. AIB Corporate
Finance Limited ("AIB Corporate Finance") (which is regulated in
Ireland by the Central Bank of Ireland) is acting as financial
advisor to AIB in relation to the Admission.
Morgan Stanley and AIB Corporate Finance anticipate acting in
the aforementioned capacities for AIB and no one else in connection
with the Admission and will not regard any other person (whether or
not a recipient of this announcement) as their respective client in
relation to the Admission and will not be responsible to anyone
other than AIB for providing the protections afforded to their
respective clients or for providing advice in relation to the
Admission or any other matter referred to in this announcement.
Apart from the responsibilities and liabilities, if any, which
may be imposed on Morgan Stanley or AIB Corporate Finance by the
ESM Rules or the Listing Rules, neither Morgan Stanley nor AIB
Corporate Finance accepts any responsibility whatsoever and makes
no representation or warranty, express or implied, for the contents
of this announcement, including its accuracy, completeness or
verification or for any other statement made or purported to be
made by AIB, or on AIB's behalf, or by Morgan Stanley or AIB
Corporate Finance, or on Morgan Stanley's or AIB Corporate
Finance's behalf, in connection with AIB, the Order, the Capital
Increase, Irish Main Market Delisting, UK Delisting or the
Admission, and nothing in this announcement is or shall be relied
upon as a promise or representation in this respect, whether as to
the past or future. Morgan Stanley and AIB Corporate Finance
accordingly disclaim to the fullest extent permitted by law and
under the ESM Rules and the Listing Rules all and any
responsibility and liability, whether arising in tort, contract or
otherwise, which it might otherwise have in respect of this
announcement and any such statement.
None of the Minister for Finance, the Department of Finance, the
Irish Government, the National Treasury Management Agency, the
National Pensions Reserve Fund Commission or any person controlled
by or controlling any such person, or any entity or agency of or
related to the Irish State, Morgan Stanley, or any director,
officer, official, employee or adviser of any such person (each
such person, a "Relevant Person") accepts any responsibility
whatsoever or makes any representation or warranty, express or
implied, for the contents of this announcement, including its
accuracy, completeness or verification or for any other statement
made or purported to be made by AIB, or on AIB's behalf, or by
Morgan Stanley, or AIB Corporate Finance, or on Morgan Stanley's or
AIB Corporate Finance's behalf, or by any Relevant Person or on any
Relevant Person's behalf in connection with AIB or the Admission,
and nothing in this announcement is or shall be relied upon as a
promise or representation in this respect, whether as to the past
or future. Each Relevant Person accordingly disclaims to the
fullest extent permitted by law and under the ESM Rules and the
Listing Rules all and any responsibility and liability, whether
arising in tort, contract or otherwise, which it might otherwise
have in respect of this document and any such statement.
The release, publication or distribution, in whole or in part,
directly or indirectly, of this announcement in jurisdictions other
than Ireland, the United Kingdom and the United States may be
restricted by law and therefore persons into whose possession this
announcement comes should inform themselves about, and observe,
such restrictions. Any failure to comply with the restrictions may
constitute a violation of the securities laws of any such
jurisdiction.
This announcement is not and does not constitute an invitation
or offer of securities to any persons, including persons in the
United States. The securities discussed herein have not been and
will not be registered under the US Securities Act of 1933 (the "US
Securities Act") or under any securities laws of any state or other
jurisdiction of the United States and may not be offered or sold
directly or indirectly, within the United States except pursuant to
an applicable exemption from, or in a transaction not subject to,
the registration requirements of the US Securities Act and in
compliance with the securities laws of any state or other
jurisdiction of the United States. There will be no public offer in
the United States.
This announcement contains "forward-looking statements", within
the meaning of Section 27A of the US Securities Act and Section 21E
of the US Securities Exchange Act of 1934, regarding the belief or
current expectations of AIB, AIB's Directors and other members of
its senior management about AIB's business, financial condition,
results of operations, certain plans or objectives and other
details relating to the Admission and the transactions described in
this announcement. These forward-looking statements can be
identified by the fact that they do not relate only to historical
or current facts. Forward-looking statements sometimes use words
such as "may", "could", "will", "aim", "expect", "intend",
"estimate", anticipate", "believe", "plan", "seek", "continue",
"target" or other words of similar meaning. All statements other
than statements of historical fact are, or may be deemed to be,
forward-looking statements.
These forward-looking statements are not guarantees of future
performance. Rather, they are based on current views and
assumptions and involve known and unknown risks, uncertainties and
other factors, many of which are outside the control of AIB and are
difficult to predict, that may cause actual results to differ
materially from any future results or developments expressed or
implied from the forward-looking statements.
The forward-looking statements speak only as of the date of this
announcement. Except as required by applicable law, regulation or
regulatory body, AIB does not have any obligation to announcement
or revise publicly any forward-looking statement, whether as a
result of new information, further events or otherwise. AIB
expressly disclaims any obligation or undertaking to publicly
release any announcements or revisions to any forward-looking
statement contained in this announcement or incorporated by
reference to reflect any change in AIB's expectations with regard
thereto or any change in events, conditions or circumstances on
which any such statement is based.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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