Public Offering of the Icelandic State’s Share in Íslandsbanki
The Icelandic Government is preparing to sell its remaining stake in Íslandsbanki, approximately 42,5% of the bank’s shares, over the coming months. The sale will be conducted in accordance with Act no. 80/2024 and grants individuals priority in the offering.
The offering process will be guided by the principles of objectivity, cost-efficiency, equity and transparency. Following expert consultation, the Ministry of Finance and Economic Affairs has identified opportunities to enhance the offering’s structure. As outlined in a draft bill currently open for consultation, the proposed changes include the addition of a third order book (Order Book C).
Order Book A: Reserved exclusively for individuals, allowing bids up to ISK 20 million. The price per share will be fixed, based on the average closing price of Íslandsbanki hf. shares over the 15 trading days preceding the publication of the offering prospectus, or the last recorded closing price, with a discount of up to 5%. Allocations in Order Book A will not be reduced due to demand in other order books. In the event of oversubscription, shares will be allocated proportionally, ensuring that individuals receive the lowest price and priority access.
Order Book B: Open to both individuals and legal entities, with a minimum bid of ISK 2 million. Allocations will be price-based. The price will be decided via a dutch auction process but will not fall below the fixed price established for Order Book A. Order Book B allocations will not be affected by allocations in Order Book C.
Order Book C: Designed for large, regulated institutional investors submitting bids of at least ISK 300 million. The price of the shares in Order Book C will be the same is in Order Book B. Eligible participants must manage total assets of at least ISK 70 billion.
These adjustments ensure participation across all investor groups. The revised structure maintains the lowest price and priority access for individuals, establishes transparent price formation in Order Book B that is also applicable to Order Book C, and provides institutional investors with a more conventional allocation process. Additionally, the updated approach is expected to facilitate the sale of a greater volume of shares.