UK to hold majority stake in RBS

The British government is all set to become a majority stakeholder with 58 per cent shareholding in the Royal Bank of Scotland (RBS) following a share issue by the banking major to raise fresh capital.

Shareholders accepted to buy only 0.24 per cent of the new company shares offered and the remaining stocks of about 57.9 per cent would now be owned by the government, RBS today said.

The government owing nearly 58 per cent of the shares is part of the recapitalisation plan for the country's banking system.

The bank received valid acceptances "in respect of 55,977,458 new RBS ordinary shares, representing about 0.24 per cent of the total number of new RBS ordinary shares offered to shareholders.

 

"HM Treasury will take up the remaining 22,853,798,818 new RBS ordinary shares, for which valid acceptances were not received. As a result, HM Treasury will own approximately 57.9 per cent. Of the enlarged issued ordinary share capital of RBS," a statement said today.

Meanwhile, the BBC in a report published on its website said the small take-up had been expected as the offer price of 65.5 pence was about 10 pence higher than the price at which the shares were trading.

Recently, shareholders of RBS had given the green signal to raise 20 billion pounds in fresh capital to tide over the worsening financial turmoil. The plan was part of the UK government's rescue initiative for the banking sector.

As per the plan, the government was to inject five billion pounds into the bank through purchase of preferential shares. The remaining 15 billion pounds was to be raised from allotting ordinary shares to the shareholders.