First Business News Portal in English from Nepal
KATHMANDU: Himalayan Bank Limited (HBL) has acquired Civil Bank. An preliminary acquisition agreement between these banks was signed at Yan & Yeti Hotel in Kathmandu today.
The possibility of merging Himalayan and Civil Bank had weakened after the initial agreement for the merger was broken last Friday.
However, after continuous discussions, Civil and Himalayan Bank had agreed to the merger. A preliminary agreement for the merger between the two banks will be signed on Wednesday. Following this, shares of Civil Bank has been halted in the secondary market.
Himalayan Bank Chairman Prachanda Bahadur Shrestha and Civil Bank’s counterpart Pratap Jung Pandey signed the agreement.
Himalayan and Civil Bank have merged in the ratio of 100: 81, meaning that shareholders in Civil Bank, which currently has 100 shares will now have 81 shares. With this acquisition, Himalayan Bank will have Rs 22 billion paid-up capital.
Following this agreement, the two two banks will carryout transactions in the name of Himalayan Bank. Ashok Rana of Himalayan will continue as the chief executive officer of the new bank.
Despite an initial agreement between Nepal Investment and Himalayan Bank to merge in April 2078, the merger failed due to a dispute over the swap ratio. The merger was terminated nine months after the Himalayan Bank’s general meeting rejected the merger proposal, saying it could not merge with the swap ratio of 1: 1.
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