National Bank of Australia is selling 18 million of its shares in Great Western Bancorp, the holding company of Great Western Bank, as the parent bank moves to exit its investment.
NAB, which has been refocusing on its core franchises in Australia and New Zealand, floated Great Western on the New York Stock Exchange in October and raised US$331 million.
In a release to the New York Stock Exchange, Great Western said it would not be issuing any shares in connection with the offering and would not receive any proceeds from the offering.
Bank of America Merrill Lynch, Deutsche Bank and JP Morgan are acting as the joint book-running managers and underwriters for the secondary offering.
Further details from GWB's corporate website show that NAB will grant the underwriters a 30 day option to purchase up to an additional 2.7 million shares of GWB common stock in connection with the offering.
In the event the offering is fully subscribed and the option to purchase additional shares is not exercised, the completion of the offering will reduce NAB's ownership stake in GWB common stock from almost 39.5 million shares, or 68.2 per cent, to just under 21.5 million shares (37.1 per cent). If the option is exercised in full, NAB's remaining stake would be reduced to less than 18.8 million shares, or 32.5 per cent of GWB.
NAB flagged in August 2014 that it would divest itself of its holdings in Great Western when market conditions allowed.
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It bought the US agribusiness bank in 2008 for about A$1 billion and sold a 27.6 per cent stake last October for US$288 million.
The pricing and completion date for the current offering have yet to be determined. A current year-to-date price chart (right) shows Great Western Bancorp shares have traded in a narrow band, between US$20 and US$24 (Source: Morningstar).
Currently, the GWB share price is slightly more than the chart's midpoint.