Wilbur Ross sells €477m Bank of Ireland stake

Investment by US billionaire three years ago kept the struggling bank out of state hands

US billionaire investor  Wilbur Ross has sold his 5.5 per cent stake in Bank of Ireland. Photo: David Sleator/The Irish Times

US billionaire investor Wilbur Ross has sold his 5.5 per cent stake in Bank of Ireland. Photo: David Sleator/The Irish Times

Tue, Jun 10, 2014, 09:23

The sale by billionaire investor Wilbur Ross of his entire shareholding in Bank of Ireland was priced at 0.265 euros a share, Deutsche Bank, the placing’s bookrunner, said in a statement.

Mr Ross announced on Monday that he would sell his 5.5 per cent stake three years after his pioneering investment kept the struggling bank out of state hands, but he added that he remained confident about its prospects.

Mr Ross, whose fund specialises in distressed assets, was among a group of North American investors who bought a 35 per cent stake only months after Ireland signed up to an EU/IMF bailout in an early vote of confidence in the debt-ravaged country.

Tuesday’s placing was priced at a 6.7 per cent discount to Monday’s closing share price of 0.28 euros, pricing the holding at €477 million. By 0859 GMT on Tuesday Bank of Ireland shares were down 2.8 per cent.

Mr Ross, who had a stake of about 9 per cent before first selling shares in the bank in March, sold those at just below 33 cent per share, meaning he almost tripled his investment having bought when shares were trading at 10 cent.

Deutsche Bank acted as sole bookrunner on the placement of Ross’s 1.8 billion shares.

Fairfax Financial boss Prem Watsa, who was also part of the 2011 consortium and who sold shares with Mr Ross in March, said that Mr Ross’s decision was “entirely unrelated to the business” and pledged to hold his own 5.8 per cent stake for the long term.

Bank of Ireland, the only Irish lender to avoid full state ownership, said in March that it had been profitable in the first few months of the year and analysts say it is well placed to pass European stress tests this year.

“Longer term, the removal of Wilbur Ross from BoI’s share register may be a positive for the bank, reducing the focus and reliance of one large high-profile investor as the group returns to normalised operating conditions,” Merrion Stockbrokers analyst Ciaran Callaghan wrote in a note.

Reuters