§ Mr. BurnsTo ask the Chancellor of the Exchequer if he will make a statement on the outcome of the Government's sale of part of its residual shareholding in British Telecommunications plc.
§ Mr. MaudeI am pleased to report that the BT share sale was successfully completed this morning, when dealings started in the partly paid shares on the London stock exchange.
Reflecting bids received in the international tender, the price of the third instalment was set at 105p per share.
Accordingly, the offer price for United Kingdom public applicants was 335p per share—comprising 110p paid on successful application, 120p to be paid by 7 July 1992, and 105p to be paid by 2 March 1993—and the offer price for applicants in the international tender was 350p per share —comprising 125p paid on successful application, 120p to be paid by 7 July 1992, and 105p to be paid by 2 March 1993.
Some 2.8 million applications were received in the United Kingdom public offer for a total of some 1.760 million BT shares. This represented some two and a half times the 675 million shares initially expected to be sold in the United Kingdom public offer.
In response to this level of applications, the Government took advantage of their ability to increase the total number of offered shares from 1,350 million to 1,575 million. The Government also decided—within this figure —to make 1,050 million shares available to applicants in 300W the United Kingdom public offer. The remaining 525 million shares were made available to bidders in the international tender.
The number of shares to which I have referred does not include any shares that S. G. Warburg Securities may have over-allotted in connection with the international tender offer, and the extent of any such over-allotment is not to be disclosed. As already announced, S. G. Warburg Securities may also effect stabilisation transactions.
For this reason, details of the numbers of shares taken up by each of the 10 regional bidding syndicates cannot be given until after 7 January 1992. However, I can say that the United Kingdom represented more than half the shares sold by Her Majesty's Treasury in the international tender offer, and that individual investors bidding in the United Kingdom retail tender bid for some 125 million shares.
In addition to the shares sold in the offers, S. G. Warburg Securities, as global co-ordinator for the sale, holds an option to acquire from HM Treasury up to a further 118.125 million shares for the purpose of meeting any over-allotments made by it in connection with the international tender offer. This option must be exercised by 7 January 1992.
Under the United Kingdom public offer, the number of shares applied for represented some 1.7 times the 1,050 million BT shares sold. Almost 99 per cent. of applicants received an allocation of BT shares, and some 43 per cent. of applicants had their applications met in full. Some 88 per cent. of applications were made through share shops, stockbrokers or other financial intermediaries.
More than 400,000 qualifying BT shareholders and more than 50,000 eligible BT employees made applications in the United Kingdom public offer, all of whom received an allocation of BT shares.
Total gross proceeds from the sale of the offered shares amount to some £5.35 billion, of which some £1.81 billion are received in this financial year.
Total gross proceeds, and proceeds this year, may be further increased—up to maxima of £5.77 billion and £1.96 billion respectively—depending on the extent, if any, to which S. G. Warburg Securities exercises its option to acquire further shares.
Details of the costs of the share sale will be published in the new year.
Following the share offer, the Government will hold some 1,366 million BT shares, approximately 22 per cent. of the total currently in issue, before deducting any BT shares that may be purchased by S. G. Warburg Securities pursuant to its over-allotment option and the BT shares that may be needed to meet share bonus entitlements under the United Kingdom public offer.