(Bloomberg) -- The UK won’t pursue a plan to sell some of its £6 billion ($8 billion) stake in NatWest Group Plc to the public, after Chancellor of the Exchequer Rachel Reeves concluded it didn’t provide value for money.
“A retail share sale offer would involve significant discounts that could cost taxpayers hundreds of millions of pounds,” Reeves told the House of Commons on Monday. “It would therefore not represent value for money and will not go ahead. It is a bad use of taxpayer money and we will not do it.”
The Chancellor said the government still intends to exit its shareholding by 2026. Bloomberg reported last week that Reeves was leaning toward offloading a substantial portion of its stake to institutional shareholders rather than continuing with her predecessor Jeremy Hunt’s plan for a retail sale.
A spokesperson for NatWest said the lender welcomed the government’s “commitment to returning NatWest Group to full private ownership.”
The sale to institutional shareholders would come alongside the government’s existing exit of its shareholding through a series of open-market sales and buybacks, people familiar with the matter told Bloomberg last week.
The UK remains NatWest’s biggest investor following a financial-crisis-era rescue deal. The government owned 19.97% of NatWest as of July 12, according to a regulatory filing earlier this month. That’s down from 38% in December.
(Adds NatWest comment in fourth paragraph.)
©2024 Bloomberg L.P.
