AIB - proposed acquisition of EBS Limited to form one of the two pillar Irish banks
(Thomson Reuters ONE) -
For Immediate Release 26(th) May 2011
AIB - proposed acquisition of EBS Limited to form one of the two pillar Irish
banks
Allied Irish Banks, p.l.c. ("AIB") [NYSE:AIB] today announces that it has signed
an agreement with the Minister for Finance (the "Minister"), the National
Treasury Management Agency (the "NTMA") and EBS Building Society ("EBS") to
acquire EBS (the "Transaction"). Following completion of the Transaction, EBS
will operate as a wholly owned, fully licensed subsidiary of AIB. This follows
the announcement by the Minister on 31 March 2011 of the Government's decision
to combine EBS with AIB to form one of the two pillar Irish banks.
The Transaction has been approved by the Minister. It is expected that the
Transaction will complete on 1 July 2011, following the statutory notice period
required as part of the demutualisation process and satisfaction of various
conditions, including the receipt of regulatory approvals.
Completion of the Transaction will be an important milestone in the creation of
a reshaped and revitalised banking sector.
EBS is a savings and loan business predominantly focused on residential mortgage
loans in the Irish market with c. 440,000 active customers and a network of 95
retail outlets. At 31 December 2010, EBS reported ?20.1 billion of total assets
and net assets of ?692 million, c. ?16.5 billion of customer loans and c. ?9.4
billion of customer deposits giving a loan to deposit ratio of 175%. EBS
reported a profit of ?56.4 million before impairment charges for the year ended
31 December 2010.
AIB has estimated that, on a pro forma basis as at 31 December 2010, the
Transaction would have had the following impact on its financial position if it
had occurred in its entirety by that date.
Estimated
At 31 December 2010 impact of the
? billions Actual Pro forma transaction
Total assets 145.2 165.3 20.1
Risk Weighted assets 98.8 108.6 9.8
Loans - Net 86.4 102.8 16.4
Deposits 52.4 61.8 9.4
Core tier 1 capital ratio 4.0% 4.4% 0.4%
Loan to deposit ratio 164.8% 166.4% 1.6%
The Transaction will be effected pursuant to an acquisition conversion scheme
mechanism under Part XI of the Building Societies Act 1989 (as amended) whereby
EBS will be demutualised by conversion from a building society into a private
limited company, to be called EBS Limited, the entire issued share capital of
which will be held by the Minister. AIB has agreed, subject to certain
conditions, to acquire the entire issued share capital of EBS Limited from the
Minister immediately upon conversion. EBS will apply to the Central Bank of
Ireland for a banking licence, which is expected to be issued prior to
conversion of EBS into a private company.
Upon completion of the Transaction, EBS Limited will operate as a separately
branded subsidiary of AIB with its own branch network.
The position of EBS customers will remain unchanged as a result of the
Transaction and customers should continue to undertake their business as normal
with EBS.
Both AIB and EBS are substantially owned by the State and, accordingly, the
consideration payable by AIB for the Transaction is a nominal cash payment of
?1.00. Following completion of the Transaction, EBS will operate as a fully
licensed subsidiary of AIB. This consideration structure best protects the
commercial interests of the State.
The Transaction constitutes a "related party transaction" for AIB for the
purposes of the ESM Rules (being a transaction between AIB and the Minister who,
through the National Pensions Reserve Fund Commission (the "NPRFC"), holds
93.1% (this holding is forecast to increase to 93.5% following the application
of a late issuance adjustment in connection with the bonus issue of shares to
the NPRFC announced by AIB on 13 May 2011) of the total issued ordinary share
capital of AIB). The Directors of AIB (the "Directors") consider, having
consulted with AIB's ESM adviser, Morgan Stanley & Co. International plc
("Morgan Stanley"), that the terms of the Transaction are fair and reasonable.
The Directors appointed by the Minister, Mr Declan Collier, Mr Dick Spring and
Dr Michael Somers, have not taken part in the AIB Board's decision to proceed
with the Transaction.
AIB shareholder approval is not required for the Transaction.
- ENDS -
For further information please contact:
Alan Kelly Catherine Burke
Director of Corporate Affairs & Head of Corporate Relations and
Marketing Communications
AIB Group AIB Group
Bankcentre Bankcentre
Dublin Dublin
Tel: +353-1-6412162 Tel: +353-1-6413894
email: alan.j.kelly(at)aib.ie email: catherine.e.burke(at)aib.ie
Morgan Stanley is acting as ongoing ESM adviser to AIB in relation to the
Transaction and in no other capacity. Additionally, Morgan Stanley is acting for
no one else in relation to the Transaction and will not regard any other person
as a client in relation to the Transaction and will not be responsible to any
other person for providing the protections afforded to its customers or for
providing advice in relation to the Transaction or any other matters referred to
in this announcement. The consultation with the Directors, as referred to
above, was for the sole benefit of the Directors for the purposes of their
obligations under rule 13 of the ESM Rules (related party transactions). It was
not made for the benefit of anyone else, including but not limited to any
shareholder of AIB, and should not to be relied on by any person or entity for
any purpose whatsoever other than the Directors, as set out above.
AIB Corporate Finance Limited is acting exclusively for AIB and no one else in
connection with the Transaction and will not regard any other person (whether or
not a recipient of this announcement) as its client in relation to the
Transaction and will not be responsible to anyone other than AIB for providing
the protections afforded to clients of AIB Corporate Finance Limited or for
providing advice in relation to the Transaction or any other matter referred to
in this announcement.
None of the Minister, the Department of Finance, the Irish Government, the NTMA
or any person controlled by or controlling any such person, or any entity or
agency of or related to the Irish State, or any director, officer, official,
employee or adviser of any such person (each such person, a "Relevant Person")
accepts any responsibility for the contents of, or makes any representation or
warranty as to the accuracy, completeness or fairness of any information in,
this announcement or any document referred to in this announcement or any
supplement or amendment thereto (each a "Document"). Each Relevant Person
expressly disclaims any liability whatsoever for any loss howsoever arising
from, or in reliance upon, the whole or any part of the contents of any
Document. No Relevant Person has authorised or will authorise the contents of
any Document.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Allied Irish Banks, p.l.c. via Thomson Reuters ONE
[HUG#1519286]
Unternehmensinformation / Kurzprofil:
Datum: 26.05.2011 - 19:11 Uhr
Sprache: Deutsch
News-ID 55053
Anzahl Zeichen: 9175
contact information:
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Kategorie:
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