The blueprint is similar to the one currently being used to sell down the State’s bailout-era holding in Bank of Ireland.
Bank of America’s Merrill Lynch International unit has been hired to carry out “a measured and orderly sell down of shares” in AIB over a six-month period, starting from next month. Mr Donohoe has instructed the US bank to target a sale of up to, but no more than, 15 per cent of the expected aggregate total trading volume in shares of AIB over the duration of the shares sell-down plan, or what is referred to as a share trading programme.
“With our share trading programme proving successful in reducing our stake in Bank of Ireland, I am now announcing the restart of our phased exit from the State’s larger investment in AIB,” Mr Donohoe said. “The bank’s financial performance has improved significantly while investor appetite for banks is also recovering, so these conditions provide a supportive environment to reduce our shareholding in the bank over time. Given the thinner liquidity in AIB shares, I expect the pace of share sales to be slower than what we’ve seen at Bank of Ireland, but it is important that we make further progress on what will be a multi-year journey.
The Department of Finance is being advised by investment bank Rothschild and law firm William Fry in relation to this transaction.