The board of country’s largest lender, State Bank of India (SBI) has approved share swap ratio to merge 5 associate banks and Bharatiya Mahila Bank (BMB) with itself. In the swap ratio an acquiring company will offer its own shares in exchange for the target company’s shares during a merger or acquisition. The merger will add to the strength of SBI – which, at assets of about Rs 23 lakh crore, is roughly 1/4 of the Indian banking system. The SBI board gave approval for scheme of acquisition for 5 associate banks and BMB, SBI informed stock exchanges.
i. SBI will give 28 of its shares for every 10 shares held of State Bank of Bikaner and Jaipur.
ii. It will give 22 of its shares for every 10 shares held of State Bank of Mysore.
iii. The lender will give 22 of its own shares for every 10 shares held of State Bank of Travancore.
iv. SBI will give 4,42,31,510 shares with face value of Re. 1 for every 100 crore equity shares of Bhartiya Mahila Bank.
Source – The Hindu