UK Government Investments has completed the disposal of part of the Treasury’s shareholding in NatWest Group.

The disposal was an off-market sale of almost 400 million ordinary shares, creating a sale price of £1.24bn.

As a result of the purchase, the Treasury’s percentage of voting rights in the company will drop from 26% to approximately 22.5%, following the cancellation by the company of most of the purchased shares and retention of the remainder in treasury.

Settlement of the purchase is set to occur on 4 June.

The news comes after the Government announced that it had abandoned the sale of its remaining shares in NatWest, as a result of the General Election.

The announcement came after the Chancellor, Jeremy Hunt, said the Government was offering the public the chance to buy shares in the bank, with an advertising campaign set to launch in the summer.

The Government stake in the lender dropped to less than 30% earlier this year, for the first time since it was bailed out in 2008, valued at just under £7bn, no longer making it a controlling shareholder.

Following this news, investment strategist at Quilter Investors, Lindsay James, said: "The summer had been earmarked as the penultimate chapter in terms of reducing the Government’s ownership of NatWest, with the launch of a retail offer harking back to the ‘Tell Sid’ campaign of the 1980s. The Government's stake once sat as high as 84% when it propped up the company back in 2008, but it was expected to reduce this from where it currently sits, at just under 30%, down to 10%.

"NatWest’s share price has been doing reasonably well in the last year, and the Treasury was likely hoping to be opportunistic in monetising this as the sale would have brought in around £6bn. Shares have performed well of late, and while banking stocks are not the most exciting, it had the potential to generate interest amongst the investing public.”

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