TIDMRBS
RNS Number : 3960U
Royal Bank of Scotland Group PLC
29 July 2015
29 July 2015
Partial Sale of Citizens Financial Group, Inc. Stake
Further to the announcement by The Royal Bank of Scotland Group
plc ("RBSG") on 28 July 2015, RBSG today announces the final
pricing of the offering of shares in Citizens Financial Group, Inc.
("CFG" or "Citizens") ("the Offering").
The Offering comprises 86 million shares, or 16.0%, of Citizens
common stock at a public offering price per share of $26.00.
RBSG has also granted a 15% over-allotment option, under which
the underwriters have a 30-day option to purchase an additional
12.9 million shares at the public offering price, less the
underwriting discount. If the underwriters exercise this option in
full, the total offering size, including the shares pursuant to the
over-allotment option, would comprise 98.9 million shares, or 18.4%
of Citizens common stock.
Gross proceeds realised by RBSG will be $2.2 billion ($2.6
billion assuming exercise in full of the over-allotment option)
with the cash proceeds being used for general business
purposes.
Concurrent to the Offering, Citizens also intend to repurchase a
further 9.6 million shares ($250m) of CFG common stock from RBSG at
the Offering price in a directed buy back.
Following the Offering and the directed buy back, RBSG will
continue to hold up to 23.4% of CFG's shares of common stock (20.9%
assuming exercise of the entire over-allotment option), which are
subject to a 60 day lock-up. During this period, the lock-up
agreement is subject to modification, waiver or cancellation.
RBSG will no longer consolidate CFG in its financial statements,
recognising an estimated GBP1.1 billion gain upon deconsolidation
(including GBP0.9 billion reclassified from equity). RBSG will
however continue to fully consolidate Citizens for regulatory
reporting purposes as it will retain certain veto rights
notwithstanding the reduction in its interest in CFG. Therefore,
RBSG will continue to include the Risk-Weighted Assets ("RWAs") of
CFG in its consolidated RWAs at the current time.
The partial sale is part of RBSG's strategy to fully exit its
holding in CFG as part of its European Commission state aid
commitments.
Commenting on today's announcement, RBS Chief Executive Officer,
Ross McEwan said:
"The sale of Citizens is an integral part of our capital plan.
It will help us to create a simpler, stronger and more efficient
UK-focussed bank that can better serve the needs of its
customers.
"This offering will leave us owning just over 20% of Citizens.
We are now targeting to be able to exit Citizens fully by the end
of 2015, a year ahead of the original deadline."
Notes:
Citizens Financial Group, Inc. is the 13(th) largest retail bank
holding company in the United States(1) , with $137.3 billion in
assets as of 30 June 2015. Headquartered in Providence, Rhode
Island, the company offers a broad range of retail and commercial
banking products and services to individuals, small businesses,
middle-market companies, large corporations and institutions. The
CFG executive team is led by Bruce Van Saun, Chairman and CEO.
For the financial year ended 31 December 2014 Citizens Financial
Group reported a U.S. GAAP profit before income tax of $1,268
million.
Morgan Stanley and Goldman, Sachs & Co are acting as global
coordinators and joint book-running managers, and J.P. Morgan and
Citigroup are acting as joint book-running managers for this
offering. Additionally, Bank of America Merrill Lynch, Credit
Suisse, Deutsche Bank Securities, RBS, UBS and Wells Fargo
Securities, are also acting as joint book-running managers.
The prospectus relating to the offering may be obtained from:
Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180
Varick Street, Second Floor, New York, New York 10014; Goldman
Sachs & Co., Attention: Prospectus Department, 200 West Street,
New York, New York 10282, via telephone: 1-866-471-2526 or via
email: prospectus-ny@ny.email.gs.com; J.P. Morgan Securities LLC,
Attention: Prospectus Department, 1155 Long Island Avenue,
Edgewood, NY 11717, via telephone: 866-803-9204; and Citigroup, c/o
Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood,
NY 11717, via telephone: 800-831-9146
The registration statement relating to these securities has been
filed and has been declared effective by the Securities and
Exchange Commission.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
these securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
For further information please contact:
Investors Media
Richard O'Connor RBS Press Office
Head of Investor Relations +44 (0) 131 523 4205
+44 (0) 207 672 1758
(1) According to SNL Financial, as at 31(st) March 2015
This announcement contains forward looking statements with
respect to the business, strategy and plans of RBS and its current
goals and expectations relating to its future financial condition
and performance. Statements that are not historical facts,
including statements about RBS or RBS management's beliefs and
expectations, are forward looking statements. By their nature,
forward looking statements involve risk and uncertainty because
they relate to future events and circumstances that will or may
occur. RBS' actual future business, strategy, plans and/or results
may differ materially from those expressed or implied in these
forward looking statements as a result of a variety of factors.
Please refer to the latest Annual Report on Form 20-F filed with
the US Securities and Exchange Commission for a discussion of
certain factors together with examples of forward looking
statements. The forward looking statements contained in this
announcement are made as at the date of this announcement, and RBS
undertakes no obligation to update any of its forward looking
statements.
.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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