Bank of Baroda recently announced that its merger with Vijaya Bank and Dena Bank will be effective from 1 April 2019, in accordance with the scheme of amalgamation that was approved by the Government of India.
Bank of Baroda’s board has fixed 11 March 2019 as the record date for the issuance and allotment of equity shares of the bank to shareholders of Dena Bank and Vijaya Bank. Citing a notification from the Government of India, Bank of Baroda said the scheme will be known as the ‘Amalgamation of Vijaya Bank and Dena Bank with Bank of Baroda’.
As per the scheme of amalgamation, Vijaya Bank’s shareholders will receive 402 shares of Bank of Baroda for every 1,000 shares that they hold. Shareholders of Dena Bank will receive 110 equity shares of Bank of Baroda for every 1,000 shares that they hold.
According to the plan, once the scheme of amalgamation commences, the boards of both Dena Bank and Vijaya Bank will be dissolved. Also, the complete share capital of both Dena Bank and Vijaya Bank will stand cancelled without any further deed, act, or instrument. The shares of the two banks will also be delisted from the stock exchanges.
In September 2018, the Government of India announced that Dena Bank and Vijaya Bank would be merged with Bank of Baroda. This merger will create the third-biggest bank in the country after State Bank of India and ICICI Bank. The plan to merge the banks received approval from the Union Cabinet in January 2019.
The merger will give the merged entity a global competitive identity and more lending power. The approved plan also states that the merger will not affect the services of employees and their current working conditions.
Source: Business Today, Moneycontrol