TIDMNWG
RNS Number : 3779V
NatWest Group plc
09 August 2022
9 August 2022
NatWest Group plc
("NatWest Group" or the "Company")
Publication of Circular and Notice of General Meeting and Notice
of Class Meeting relating to
a proposed Special Dividend and associated Share
Consolidation
NatWest Group is pleased to announce that, following the
announcement on 29 July 2022 in relation to the proposed Special
Dividend and associated Share Consolidation, a circular setting out
the full details of the proposed Special Dividend, Share
Consolidation and related matters (the "Circular") has been
published today.
The Circular confirms that, in line with previous announcements,
NatWest Group intends to return approximately GBP1.75 billion to
Ordinary Shareholders by way of a proposed Special Dividend of
GBP0.168 per Existing Ordinary Share in the capital of NatWest
Group. In addition, in order to maintain the comparability, so far
as practicable, of NatWest Group's share price before and after the
Special Dividend, it is proposed that the Special Dividend be
accompanied by a Share Consolidation resulting in Ordinary
Shareholders receiving 13 New Ordinary Shares with a nominal value
of GBP1.0769 each for every 14 Existing Ordinary Shares that they
hold*.
Notice of General Meeting and Class Meeting
The Circular contains further details of these matters as well
as: (i) a notice convening a General Meeting of Shareholders to be
held at Gogarburn, Edinburgh EH12 1HQ at 2.00 p.m. on 25 August
2022; and (ii) a notice convening a Class Meeting of Ordinary
Shareholders to be held at Gogarburn, Edinburgh EH12 1HQ at 2.30
p.m. on 25 August 2022, or as soon as the General Meeting has
completed or been adjourned.
Special Dividend
Assuming the conditions described below are satisfied, the Board
is recommending that Shareholders approve a Special Dividend in
pounds sterling to Ordinary Shareholders on the Register as at 6.00
p.m. (UK time) on 26 August 2022. The Special Dividend is expected
to be paid to such Ordinary Shareholders on 16 September 2022.
An equivalent amount in respect of the Special Dividend is
proposed to be paid in US dollars to holders of American depositary
receipts ("ADRs", each representing two Ordinary Shares in NatWest
Group) (the "ADR Holders") on the ADR Register as at 5.00 p.m. (New
York time) on 26 August 2022 based on an exchange rate determined
in accordance with the deposit agreement pursuant to which the ADRs
were issued (the "Deposit Agreement"). Cheques for the payment of
such amount are expected to be despatched on or around 16 September
2022.
The Special Dividend is subject to the approval of Shareholders
at the General Meeting. It is also conditional upon: (i) the
approval by Shareholders at the General Meeting of the Share
Consolidation; (ii) the approval by Shareholders at the General
Meeting of the proposed amendments to the Articles as a result of
the Share Consolidation; (iii) the approval by Ordinary
Shareholders at the Class Meeting of the Share Consolidation and
proposed amendments to the Articles as a result of the Share
Consolidation; and (iv) Admission in respect of the New Ordinary
Shares taking place by or as soon as practicable after 8.00 a.m.
(UK time) on 30 August 2022.
*Note: the nominal value of the New Ordinary Shares without
rounding is GBP1.076923076923077 per share
Share Consolidation
As all Existing Ordinary Shares will be consolidated, whilst
each Ordinary Shareholder will hold fewer Ordinary Shares following
the Share Consolidation, each Ordinary Shareholder will still hold
the same proportion of NatWest Group's Ordinary Share capital (i.e.
the total number of Existing Ordinary Shares in issue) immediately
before and after the Share Consolidation (subject to any fractional
entitlements, which will be dealt with in accordance with the
process described in the Circular). Although the New Ordinary
Shares will have a different nominal value (being GBP1.0769 each)
to the Existing Ordinary Shares, they will be traded on the London
Stock Exchange in the same way as the Existing Ordinary Shares and
will carry the same rights under the Articles as the Existing
Ordinary Shares, subject to consequential amendments to the
Articles as set out in the Circular . The Share Consolidation will
apply to Ordinary Shareholders on the Register as at 6.00 p.m. (UK
time) on 26 August 2022.
As a result of the Share Consolidation, for each existing ADR
held on the ADR Register as at 5.00 p.m. (New York time) on 26
August 2022, ADR Holders will, upon cancellation of their Existing
ADRs, be issued and receive New ADRs in the ratio of 13 New ADRs to
replace every 14 Existing ADRs (to be distributed in accordance
with the Deposit Agreement after giving effect to the fees and
expenses provided for therein).
The Share Consolidation is subject to the approval of
Shareholders at the General Meeting. It is also conditional upon:
(i) the approval by Shareholders at the General Meeting of the
Special Dividend; (ii) the approval by Shareholders at the General
Meeting of the proposed amendments to the Articles as a result of
the Share Consolidation; (iii) the approval by Ordinary
Shareholders at the Class Meeting of the Share Consolidation and
the proposed amendments to the Articles as a result of the Share
Consolidation; and (iv) Admission in respect of the New Ordinary
Shares taking place by or as soon as practicable after 8.00 a.m.
(UK time) on 30 August 2022.
Additional resolutions
The Share Consolidation will have an impact on the authorities
taken by the Company at its 2022 AGM. To reflect this impact, at
the General Meeting, approval by Shareholders will also be sought
to amend the annual authorities to enable NatWest Group to make
market purchases of its Ordinary Shares, allot New Ordinary Shares
and to disapply pre-emption rights, to cover the period between the
date of the General Meeting and the 2023 AGM. Additional approvals,
which are for consequential amendments required as a result of the
Share Consolidation only, will also be sought to amend the Directed
Buyback Contract in relation to the existing authority for
off-market purchases of Ordinary Shares from HM Treasury, and to
amend the Articles . These resolutions are conditional upon: (i)
the approval by Shareholders of the Special Dividend and the Share
Consolidation; (ii) the sanction of Ordinary Shareholders to be
sought at the Class Meeting; and (iii) Admission in respect of the
New Ordinary Shares taking place by or as soon as practicable after
8.00 a.m. (UK time) on 30 August 2022. Further details of these
additional resolutions are set out in the Circular. Additionally,
at the Class Meeting of Ordinary Shareholders, approval by Ordinary
Shareholders will also be sought to amend the Articles, which will
be treated as a variation of the voting rights attaching to
Ordinary Shares.
Background
The strength of NatWest Group's balance sheet and financial
performance mean that it is well positioned to grow its lending to
customers responsibly and provide support to those who are likely
to need it most whilst also continuing to transform the bank and
deliver sustainable returns to Shareholders.
In 2021, NatWest Group returned GBP3.8 billion to Shareholders
through a combination of ordinary dividends, directed buybacks of
Ordinary Shares from HM Treasury and its on-market buyback
programme. In 2022, NatWest Group completed a GBP1.2 billion
directed buyback from HM Treasury, a GBP750 million on-market
buyback programme and it has announced an interim dividend
equivalent to GBP364 million. Even after taking into account these
distributions, NatWest Group's CET1 ratio at the end of June 2022
was 14.3 per cent. (including the accrual of the Interim Dividend
and the accrual of the Special Dividend), well above its target
CET1 ratio for end of 2022 of 14 per cent. and 2023 of 13 to 14 per
cent. Given the significant surplus capital within NatWest Group
today, the Board is proposing a Special Dividend of approximately
GBP1.75 billion. NatWest Group's UK leverage ratio headroom and
liquidity coverage ratio are also both comfortably above regulatory
requirements.
The Board has chosen to implement this return of capital through
a Special Dividend and Share Consolidation (as is often done in the
case of significant special dividends) because it can be executed
efficiently, treats all Ordinary Shareholders equally, is
financially attractive and avoids increasing the proportion of
NatWest Group owned by HM Treasury:
(i) Speed of execution: this method of distribution allows
NatWest Group to return a significant amount of capital to Ordinary
Shareholders quickly compared to an on-market buyback programme
which, to return this amount of capital, would take many months
given that it is constrained by daily trading volume limits;
(ii) Equal treatment of all Ordinary Shareholders: all Ordinary
Shareholders on the Register, and ADR Holders on the ADR Register,
at the record date are entitled to the same Special Dividend per
share of GBP0.168;
(iii) Attractive financial impact: by undertaking the Share
Consolidation alongside the Special Dividend, it is accretive to
NatWest Group's earnings per share and tangible book value per
share, similar to the financial effects of an on-market buyback
programme; and
(iv) No change in HM Treasury's shareholding: further on-market
buyback programmes without sell-downs by HM Treasury would cause HM
Treasury's shareholding in NatWest Group to increase. The Special
Dividend and the Share Consolidation does not increase HM
Treasury's shareholding.
NatWest Group has maintained capacity to participate in directed
buybacks of HM Treasury's shareholding in NatWest Group,
recognising that any exercise of this authority is dependent upon
HM Treasury's intentions. As a result of the completed directed
buyback in March 2022, NatWest Group will not be able to conduct a
directed buyback under its current authorities until March
2023.
Expected timetable
The expected timetable for the General Meeting, the Class
Meeting, the Special Dividend and the Share Consolidation is set
out below. All references to times are to UK time unless stated
otherwise.
Publication and posting of the Circular, including the 9 August 2022
Notice of General Meeting and the Notice
of Class Meeting
Latest time and date for receipt of ADR Voting Cards from 12.00 p.m. (New York time) on 19 August 2022
ADR Holders in respect of the General
Meeting and the Class Meeting
Proxy vote lodged on behalf of ADR voters 22 August 2022
Latest time and date for receipt of Form of Proxy and 2.30 p.m. on 23 August 2022
CREST Proxy Instructions from Shareholders
in respect of the General Meeting and/or the Class
Meeting
Record time and date for entitlement to vote at the 6.00 p.m. on 23 August 2022
General Meeting
Record time and date for entitlement of Ordinary 6.00 p.m. on 23 August 2022
Shareholders to vote at the Class Meeting
General Meeting 2.00 p.m. on 25 August 2022
Class Meeting of Ordinary Shareholders 2.30 p.m. on 25 August 2022 (or as soon as the General
Meeting has completed or been adjourned)
Latest time for dealings in Existing Ordinary Shares 4.30 p.m. on 26 August 2022
Record time and date for entitlement to Special Dividend 6.00 p.m. on 26 August 2022
and Share Consolidation for Ordinary
Shareholders
Effective time and date for entitlement to Special 5.00 p.m. (New York time) on 26 August 2022
Dividend and Share Consolidation for ADR
Holders
Ordinary Shares (but not ADRs) marked ex-entitlement 8.00 a.m. on 30 August 2022
Effective time and date for the Share Consolidation for 8.00 a.m. on 30 August 2022
Ordinary Shareholders
Commencement of dealings in New Ordinary Shares on the 8.00 a.m. on 30 August 2022
London Stock Exchange (after the Share
Consolidation)
CREST accounts credited with New Ordinary Shares (after 30 August 2022
the Share Consolidation)
Effective date for the Share Consolidation for ADR 30 August 2022
Holders
ADRs marked ex-entitlement 30 August 2022
Commencement of dealings in New ADRs on a "When-Issued" 30 August 2022
basis
Commencement of dealings in New ADRs on "Regular Way" 1 September 2022
basis
Credit of New ADRs to ADR Holders 1 September 2022
Despatch of share certificates in respect of New Ordinary No later than 14 September 2022
Shares
Payment of the Special Dividend to Ordinary Shareholders 16 September 2022
(by CREST payment, BACS/SEPA or by
cheque)
Despatch of cheques to ADR Holders in respect of the On or around 16 September 2022
Special Dividend (and Interim Dividend)
If any of the above times and/or dates change, NatWest Group
will give notice of the change by issuing an announcement through a
regulatory information service.
Availability of the Circular
Printed copies of the Circular will be posted today to
Shareholders and any other person entitled to receive a copy (other
than those who have elected for, or who have been deemed to have
elected for, notification by electronic communication).
A copy of the Circular and certain other documents in relation
to the Special Dividend and the Share Consolidation are available
for inspection on NatWest Group's website at
https://investors.natwestgroup.com/shareholder-centre/shareholder-meetings
.
A copy of the Circular (containing the Notice of General Meeting
and Notice of Class Meeting) has been submitted to the National
Storage Mechanism, where it will shortly be available for
inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
Capitalised terms used but not otherwise defined in this
announcement have the same meaning given to them in the
Circular.
For more information contact:
Investor Relations
+ 44 (0)207 672 1758
Media Relations
+44 (0) 131 523 4205
Merrill Lynch International
+44 20 7628 1000
Important notices
Merrill Lynch International, which is authorised in the UK by
the Prudential Regulation Authority and regulated in the UK by the
Financial Conduct Authority and the Prudential Regulation
Authority, is acting as financial adviser and corporate broker for
NatWest Group and for no one else in connection with the Special
Dividend and the Share Consolidation, and will not be responsible
to anyone other than NatWest Group for providing the protections
afforded to clients of Merrill Lynch International nor for
providing advice in connection with the Special Dividend or Share
Consolidation or any other matters referred to in this
announcement. Neither Merrill Lynch International nor any of its
affiliates, directors or employees owes or accepts any duty,
liability or responsibility whatsoever (whether direct or indirect,
consequential, whether in contract, in tort, in delict, under
statute or otherwise) to any person who is not a client of Merrill
Lynch International in connection with this announcement, any
statement contained herein, the Special Dividend, the Share
Consolidation or otherwise.
This announcement is not intended to, and does not constitute or
form part of, and should not be construed as, any offer,
invitation, solicitation or recommendation of an offer to purchase,
sell, subscribe for or otherwise dispose of or acquire any
securities or the solicitation of any vote or approval in any
jurisdiction and neither the issue of the information nor anything
contained herein shall form the basis of or be relied upon in
connection with, or act as an inducement to enter into, any
investment activity. No shares are being offered to the public by
means of this announcement. This announcement does not constitute
either advice or a recommendation regarding any securities, or
purport to contain all of the information that may be required to
evaluate any investment in NatWest Group or any of its securities
and should not be relied upon to form the basis of, or be relied on
in connection with, any contract or commitment or investment
decision whatsoever. Past performance is not an indication of
future results and past performance should not be taken as a
representation that trends or activities underlying past
performance will continue in the future.
Shareholders are advised to carefully read the Circular. Any
response to the Share Consolidation and Special Dividend should be
made only on the basis of the information in the Circular. If you
are in any doubt as to what action you should take in relation to
this announcement or the Circular, you are recommended to seek your
own personal financial advice immediately from your stockbroker,
bank manager, solicitor, accountant or other independent financial
adviser authorised under the Financial Services and Markets Act
2000, or from another appropriately authorised independent
financial adviser.
The distribution of this announcement in jurisdictions in or
from certain jurisdictions may be restricted or prohibited by the
laws of any jurisdiction other than the United Kingdom. Recipients
are required to inform themselves of, and comply with, all
restrictions or prohibitions in such other jurisdictions. Any
failure to comply with applicable requirements may constitute a
violation of the laws and/or regulations of other such
jurisdiction.
This announcement has been prepared for the purposes of
complying with the applicable law and regulation of the United
Kingdom (including the Listing Rules and the Disclosure Guidance
and Transparency Rules) and the information disclosed may not be
the same as that which would have been disclosed if this
announcement had been prepared in accordance with the laws and
regulations of any jurisdiction outside of the United Kingdom.
This announcement is being distributed to all shareholders in
NatWest Group and holders of NatWest Group's ADRs. A copy of this
announcement can be found on our website at
www.natwestgroup.com.
Forward-looking statements
This document may include forward-looking statements within the
meaning of the United States Private Securities Litigation Reform
Act of 1995, such as statements that include, without limitation,
the words 'expect', 'estimate', 'project', 'anticipate', 'commit',
'believe', 'should', 'intend', 'will', 'plan', 'could',
'probability', 'risk', 'Value-at-Risk (VaR)', 'target', 'goal',
'objective', 'may', 'endeavour', 'outlook', 'optimistic',
'prospects' and similar expressions or variations on these
expressions. These statements concern or may affect future matters,
such as NatWest Group's future economic results, business plans and
strategies. In particular, this document may include
forward-looking statements relating to NatWest Group in respect of,
but not limited to: its economic and political risks, its
regulatory capital position and related requirements, its financial
position, profitability and financial performance (including
financial, capital, cost savings and operational targets), the
impact of the Share Consolidation and the Special Dividend, the
implementation of its purpose-led strategy, its environmental,
social, governance and climate related targets, its access to
adequate sources of liquidity and funding, increasing competition
from new incumbents and disruptive technologies, the impact of the
COVID-19 pandemic, its exposure to third party risks, its ongoing
compliance with the UK ring-fencing regime and ensuring operational
continuity in resolution, its impairment losses and credit
exposures under certain specified scenarios, substantial regulation
and oversight, ongoing legal, regulatory and governmental actions
and investigations, the transition of LIBOR and IBOR rates to
alternative risk free rates and NatWest Group's exposure to
operational risk, conduct risk, cyber, data and IT risk, financial
crime risk, key person risk and credit rating risk. Forward-looking
statements are subject
to a number of risks and uncertainties that might cause actual
results and performance to differ materially from any expected
future results or performance expressed or implied by the
forward-looking statements. Factors that could cause or contribute
to differences in current expectations include, but are not limited
to, future growth initiatives (including acquisitions, joint
ventures and strategic partnerships), the outcome of legal,
regulatory and governmental actions and investigations, the level
and extent of future impairments and write-downs (including with
respect to goodwill), legislative, political, fiscal and regulatory
developments, accounting standards, competitive conditions,
technological developments, interest and exchange rate
fluctuations, general economic and political conditions, the impact
of climate-related risks and the transitioning to a net zero
economy and the impact of the COVID-19 pandemic. These and other
factors, risks and uncertainties that may impact any
forward-looking statement or NatWest Group's actual results are
discussed in NatWest Group's UK 2021 Annual Report and Accounts
(ARA), NatWest Group's Interim Results for Q1 2022 and H1 2022 and
NatWest Group's filings with the US Securities and Exchange
Commission, including, but not limited to, NatWest Group's most
recent Annual Report on Form 20-F and Reports on Form 6-K. The
forward-looking statements contained in this document speak only as
of the date of this document and NatWest Group does not assume or
undertake any obligation or responsibility to update any of the
forward-looking statements contained in this document, whether as a
result of new information, future events or otherwise, except to
the extent legally required.
No statement in this document is or is intended to be a profit
forecast or to imply that the earnings of NatWest Group for the
current or future financial years will necessarily match or exceed
the historical or published earnings of NatWest Group.
Any information contained in this document on the price at which
shares or other securities in NatWest Group have been bought or
sold in the past, or on the yield on such shares or other
securities, should not be relied upon as a guide to future
performance.
LEI: 2138005O9XJIJN4JPN90
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END
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