Dutch State to Sell off ABN Amro in Initial Public Offering

27 Oct 2015 | Author: | No comments yet »

ABN Amro I.P.O. Will Go Ahead, Dutch Government Says.

LONDON — The government of the Netherlands said on Tuesday that it planned to proceed with a sale of shares of the state-owned lender ABN Amro in an initial public offering, possibly as soon as the fourth quarter of this year. A share sale will give the Dutch government an opportunity to recoup some of the €22bn investment it made to prop up the lender in 2008 and save it from collapse. NL Financial Investments, which manages the government’s holdings in the bank, said the government would seek to list shares of ABN Amro on the Euronext Amsterdam stock exchange and, “barring unforeseen circumstances,” could do so before the end of the year.

With the IPO, the government is seeking to recoup what it spent on a rescue that involved breaking the company up after competitors took it over in a record deal in 2007. The government “will retain retain a significant majority holding in ABN AMRO after its listing, although it is the intention to fully exit from the Company over time.”

The bank traces its roots to ABN Amro Holding, which was broken up in 2007 after a €71 billion deal in which the Royal Bank of Scotland, Banco Santander of Spain and the Belgian bank Fortis bought parts of that company. Net income excluding out one-time items almost doubled to 600 million euros in the second quarter from a year earlier, the Amsterdam-based company said in August. “ABN will be attractive to investors who’re looking for a safe dividend,” said Corne van Zeijl, who manages 1 billion euros on behalf of Actiam NV. “There’s not a lot of growth at the bank. The offering will consist of sales to retail and institutional investors in the Netherlands and a private placement to qualified institutional investors internationally. “We are proud that we are now ready for this next step in the process,” Gerrit Zalm, the chairman of ABN Amro’s managing board, said in a news release, “a next step that in the end will allow ABN Amro to continue to focus on its client-centric approach helping our customers to realize their financial ambitions.” The Dutch state will retain a majority stake in the company after the IPO, although it plans to completely exit the company eventually, according to the statement on Tuesday.

Finance Minister Jeroen Dijsselbloem delayed a decision on an IPO in March when a 100,000-euro salary increase for six ABN Amro board members prompted the resignation of a supervisory board member. Morgan Stanley, Deutsche Bank AG and ABN Amro are managing the IPO, along with Bank of America Corp., Barclays Plc, Citigroup Inc., JPMorgan Chase & Co., ING Groep NV and Rabobank.

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