* Ross stake sales worth almost triple original investment
* Joins other investors who have profited from banking woes
* Shares placed at 6.7 percent discount
* Bank of Ireland shares down 3.2 percent
(Adds source on book, new shareholders)
By Freya Berry and Padraic Halpin
LONDON/DUBLIN, June 10 U.S. billionaire Wilbur
Ross sold his entire shareholding in Bank of Ireland
for almost half a billion euros on Tuesday, to almost triple the
value of a shrewd investment made at the height of the euro zone
Ross has said he would sell his 5.5 percent stake three
years after his pioneering investment kept the struggling bank
out of state hands, and his holding was snapped up at 0.265
euros a share.
The 76-year-old investor, who made his name by snapping up
out-of-favour assets ranging from banks to textile firms, joins
several big investors who timed their bets to make significant
profits from stepping in to bail out European banks.
"This has been a terrific investment for us," Ross told
Reuters in response to emailed questions, adding that even
though he remained confident in the bank and in Ireland's
prospects, he had become too concentrated in banking.
Ross, whose fund specialises in so-called distressed assets,
was among a group of North American investors who bought a 35
percent stake months after Ireland signed up to an EU/IMF
bailout, effectively giving an early vote of confidence in the
He told Reuters in April he was assessing distressed assets
in Greece, Spain, Portugal and Italy and was looking to make
investments in the next few months.
Tuesday's placing in Bank of Ireland was priced at a 6.7
percent discount to the stock's closing price of 0.28 euros on
Monday, valuing the holding at 477 million euros ($649 million).
By 1100 GMT Bank of Ireland shares were down 3.2 percent.
A source familiar with the matter said Ross's 1.8 billion
shares had been bought by a mixture of existing shareholders and
other investors. Deutsche Bank acted as sole
Ross, who had a stake of about 9 percent before first
selling shares in the bank in March, sold that initial stake at
just below 0.33 euros per share, meaning he almost tripled his
investment having bought when the shares were trading at 0.10
BET ON RECOVERY
Through an investment in Virgin Money, Ross also
got into British banks, a sector where others have succeeded.
Investors from Qatar and Abu Dhabi made more than 1 billion
pounds each on bets on Barclays when the bank needed
cash in 2008.
He was also one of many international investors - from
tycoon Donald Trump to investment firms such as Lone Star and
Franklin Templeton - who bet on Ireland's recovery by buying up
everything from bonds to hotels and apartment blocks after a
devastating economic and banking crisis.
Liquidators appointed to the collapsed Anglo Irish Bank, who
in recent months sold loans with a book value of 21.7 billion
euros, said last week the disposal was the biggest loan sale in
the world in the past two years.
Fairfax Financial boss Prem Watsa, who was also
part of the 2011 consortium and who sold shares with Ross in
March, told Reuters on Monday Ross's decision was "entirely
unrelated to the business" and pledged to hold his own 5.8
percent stake for the long term.
The Irish government, the bank's largest shareholder with 14
percent, has said it has no interest in running banks long term
but is under no financial or political pressure to sell.
Bank of Ireland, the only Irish lender to avoid full state
ownership, said in March it had been profitable in the first few
months of the year and analysts say it is well placed to pass
European "stress tests" on the sector this year.
"Longer term, the removal of Wilbur Ross from BoI's share
register may be a positive for the bank, reducing the focus and
reliance of one large high-profile investor as the group returns
to normalised operating conditions," Merrion Stockbrokers
analyst Ciaran Callaghan wrote in a note.
"However, more short term, his sudden departure is likely to
raise questions over the future upside to the bank's equity
valuation and the challenges that remain ahead, despite its
recent return to profitability and capital generation."
($1 = 0.7345 Euros)
(Additional reporting by Steve Slater in London; Editing by
David Goodman and David Hmolmes)