§ Mr. BurnsTo ask the Chancellor of the Exchequer if he will make a statement on the outcome of the Government's sale of substantially all of its residual shareholding in British Telecommunications plc.
§ Mr. DorrellI am pleased to report that the Government's combined offers of BT shares were successfully completed this morning when dealings in interim rights started on the London stock exchange.
As a result of bids received in the international offer, the price of the third instalment for all investors in the combined offers was set at 120p per share.
Accordingly, the price for interim rights purchased in the United Kingdom public offer was 410p per share, comprising 150p paid on successful application, 140p to be paid by 1 March 1994 and 120p to be paid by 11 October 1994.
The price for shares purchased in the international offer was 420p per share, comprising 160p paid on successful application, 140p to be paid by 1 March 1994 and 120p to be paid by 11 October 1994.
The Government offered for sale up to 1,220 million shares in the combined offers.
Some 1.67 million applications were received in the United Kingdom public offer for a total of some 1,057 million shares. This represented some 1.73 times the shares initially expected to be sold in the UK public offer. In response to this demand, the Government increased the total number of shares allocated to the UK public offer to 732 million shares. At this level, the number of shares applied for in the UK public offer represented some 1.44 times the shares available.
Over 95 per cent. of applicants in the UK public offer received an allocation of BT shares. Over 55 per cent. of 31W applicants had their applications met in full. Some 97 per cent. of applications made through share shops were allocated shares.
More than 785,000 qualifying BT shareholders and more than 23,000 eligible BT employees made applications in the United Kingdom public offer. All such applicants received an allocation of BT shares. 488 million shares were allocated to bidders in the international offer. This number does not include any shares that S. G. Warburg Securities may have over-alloted in connection with the international offer. The extent of any such over-allotment will not be disclosed. As already announced, S. G. Warburg Securities may also effect stabilisation transactions.
For these reasons, details of the percentages of shares allocated to each geographic region in the international offer may not be available until after 18 August 1993. However, the United Kingdom accounted for some 62 per cent. of the shares sold by Her Majesty's Treasury in the international offer. Individual investors bidding in the United Kingdom retail tender bid for some 104 million shares. Of this, some 44 million shares were in respect of PEP applications.
In addition to the shares sold in the combined offers, S. G. Warburg Securities, as global co-ordinator for the sale, holds an option to acquire from Her Majesty's Treasury up to a further 91.5 million shares for the purpose of meeting any over-allotment made by it in connection with the international offer. This option must be exercised by 18 August 1993.
Total gross proceeds from the combined offers amount to some £.4.97 billion, of which some £3.53 billion is expected to be received in this financial year.
Total gross proceeds may be further increased by a maximum of £0.38 billion to the extent that, if at all, S. G. Warburg Securities exercises its option to acquire further shares.
Details of the costs of the share sale will be published shortly.
Following the combined offers, and assuming the exercise in full of the option over BT shares granted by Her Majesty's Treasury to S. G. Warburg Securities, Her Majesty's Treasury expects to hold not more than 1.5 per cent. of BT's issued share capital. This would comprise principally shares that may be needed to meet share bonus entitlements under the BT3 United Kingdom public offer and as a result of the Government's sale of BT shares in December 1991.