Ireland’s government has announced the disposal of its 5% stake in Allied Irish Banks (AIB) by placing shares in an accelerated book-building process to institutional investors.

The €304.8m deal will reduce the Irish state’s shareholding in the lender from 68.5% to 63.5% of the ordinary share capital.

The Irish government has been gradually reducing its stake in AIB in 2022.

Last week, the Irish Minister for Finance Paschal Donohoe announced the extension of the AIB’s share trading plan.

“When I announced the launch of the share trading plan last December, I said that the State’s exit from its investment in AIB would be a multi-year journey, so it is important, and I believe it is in the taxpayers’ best interest, to extend the share trading plan for a further period. I will continue to keep other monetisation options open, should these opportunities present themselves,” Donohoe’s statement read.

Concurrently, he revealed that the share sale had fetched around €161m and brought down the state’s stake in the lender to 68.5% from 71.1% over the past six months

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By GlobalData

For the latest placement of shares, Rothschild & Co is acting as independent financial adviser and William Fry LLP and Allen & Overy LLP are acting as legal counsel to the Irish state.

During the financial crisis in the wake of the property crash, the Irish government pumped $72bn into the banking system.

It also owns a stake in the Bank of Ireland and Permanent TSB.