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Cabinet Clear BoB share swap ratio with Vijaya Bank and Dena Bank

The government in September last year had announced merger of state-owned Vijaya Bank and Dena Bank, with larger peer Bank of Baroda, aiming to create the third largest lender after SBI and ICICI Bank.

The Union Cabinet approving the deal and banks announcing share swap ratio for the transaction.

Bank of Baroda (BoB) on Wednesday finalised the share swap ratio for merger of Vijaya Bank and Dena Bank with itself. As per the Scheme of Amalgamation, shareholders of Vijaya Bank will get 402 equity shares of BoB for every 1,000 shares held. In case of Dena Bank, its shareholders will get 110 shares for every 1,000 shares of BoB.

The combined market capitalisation of the merged entity is currently at Rs 42,301 crore.

According to BloombergQuint calculation, the swap ratios simply impact that:

         Dena Bank has been valued at a discount of 27 percent to the current market price.
Vijaya Bank has been valued at a discount of 6 percent to the current market price.

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