Lloyds Bank yesterday sold its 4.6 per cent stake in Standard Chartered almost nine years to the day since it attempted a hostile bid for Standard. Lloyds claimed a profit on the sale of £82m.
By placing the stake with 30 UK institutions via Hoare Govett, Lloyds has signalled its determination to pursue a quality UK retail strategy, following the positive vote by Cheltenham & Gloucester members to accept its £1.8bn bid last Friday, according to analysts.
The sale puts an end to speculation that surfaced regularly over the years since 1986 that Lloyds could renew its interest in Standard, which is well placed in the dynamic Far Eastern economies, or place the stake with another bidder.
Lloyds said it had placed the whole stake at 290p a share and that the sale would benefit its profit and loss account by around £82m.
The sale inevitably removed some of what remained of bid speculation surrounding Standard, whose shares closed down 5p at 294p.
Lloyds said it sold the shares through Hoare Govett, realising a potential profit of over £1m for Hoare.
Tan Sri Khoo , the Singapore-based entrepreneur who was one of the three white knights who helped Standard fight off Lloyds in 1986, is keeping his 15 per cent stake.
Lloyds never admitted that it was holding on to the shares in case of a bid but it was not until the offer for the C&G that it had given up any international ambitions.
Lloyds Bank's chief executive, Sir Brian Pitman, said the board no longer considered there was a strategic advantage in holding the Standard Chartered stake. A Lloyds spokesman added that the bank had held on to the stake as an investment, and that now was a good time to sell.
A spokesman for Standard welcomed the sale: "It's good for Standard because the 5 per cent stake has been overhanging the shares. It's also good for liquidity." The spokesman said that the sale did not affect the status of Tan Sri Khoo's stake at all. Standard announced 1994 profits up 27 per cent to £510m, flattered by a £111m fall in bad debt provisions.