RSS   Newsletter   Contact   Advertise with us

RBS to sell almost all of its stake in Direct Line

Staff writer ▼ | February 27, 2014
Royal Bank of Scotland (RBS) intends to sell almost all of its remaining stake in Direct Line Insurance Group through a placement to institutional investors.
RBS
RBSRoyal Bank of Scotland (RBS) intends to sell almost all of its remaining stake in Direct Line Insurance Group through a placement to institutional investors.


Royal Bank of Scotland said it would offer 423.2 million shares, representing 28.2 percent of Direct Line, and retain 4.2 million shares to satisfy long-term incentive plan awards granted to Direct Line executives. RBS was ordered by European regulators to sell all of Direct Line by the end of 2014 as a penalty for its bailout in 2008 that left it 81 percent-owned by the British government.

RBS, which spun off Direct Line in the wake of the financial crisis, said the pricing of the shares it plans to sell would be determined by a bookbuilding process that would start immediately. Goldman Sachs International, Morgan Stanley Securities Ltd and UBS Ltd will act as joint bookrunners in the offering, RBS said.

Royal Bank of Scotland plans to shrink its investment banking and international operations as part of a revamp in which the group could shed up to a quarter of its 120,000 workforce.

Direct Line reported a 70 percent rise in full-year pretax profit, helped by fewer home insurance claims. Net earned premiums fell 5 percent to 3.52 billion pounds.


 

MORE INSIDE POST