The Boards of both banks, HDFC and Centurion Bank of Punjab, have okayed a swap ratio of 1 share of HDFC Bank for every 29 shares of CboP, reports CNBC-TV18.
The merger ratio has come in favour of HDFC Bank at current market price.
HDFC Bank will make a preferential issue to HDFC after the merger to maintain 23.28% stake. The merger values CBoP at Rs 50.80 per share.
Visitors to my site may recall that in response to numerous recent queries about CBOP when it was trading above 70, I had given a SELL call on it. Today's closing price on the BSE was 48.25. My call stands vindicated.