Vijaya Bank/Dena Bank merger with BOB-Share exchange ratio and other rights of Shareholders

Amalgamation of Vijaya Bank and Dena Bank with Bank of Baroda from 01.04.2019-Share exchange ratio and other rights of Shareholders of Transferor banks

The Government has notified the Amalgamation of Vijaya Bank and Dena Bank with Bank of Baroda Scheme, 2019.The Scheme shall come into force on the 1st day of April, 2019.

On the commencement of this Scheme, the undertakings of the Vijaya Bank and Dena Bank shall be transferred to and shall vest in the Bank of Baroda.

The following guidelines of the Scheme have been prescribed for protecting the interests of the shareholders on the both transferor banks.

1. Bank of Baroda shall issue shares to the shareholders of the Dena Bank and Vijaya Bank as per the Share Exchange Ratio determined as per the Scheme.
2. The shareholders of the both, the Bank of Baroda and Transferor Banks shall be entitled to raise grievances, if any, in relation to the Share Exchange Ratio. However, only shareholders who either (a) individually or collectively hold at least one per cent of the total paid up equity capital of any of the Bank of Baroda, or the Transferor Banks or (b) are one hundred shareholders acting collectively, of any of the Bank of Baroda, Transferor Banks shall be entitled to raise objections to the Share Exchange Ratio.
3. While issuing the shares as above−

(i) no fractional shares shall be issued in respect of fractional entitlements to any shareholder, instead cash equal to the value of such fractional share shall be paid.

(ii) the equity shares issued and allotted by the BoB shall rank pari passu in all respects and shall have the same rights attached to them as the then existing equity shares of the Bank of Baroda, including, dividends, if any, declared by the Bank of Baroda, on or after the commencement of this Scheme;

(iii) Pending share transfers (whether lodged or outstanding) of any shareholder on the record dateshall be effected by the Board of the BoB even subsequent to the record date

(iv) the equity shares of the BoB issued as above shall be listed and admitted to trading on the relevant stock exchanges, where the equity shares of the Bank of Baroda are presently listed or admitted to trading

(v) the equity shares to be issued by the BoB, the allotment or transfer of which is held in abeyance under applicable law shall, pending allotment or settlement of dispute by order of the appropriate court or otherwise, also be kept in abeyance in like manner by the Bank of Baroda.

Share Exchange Ratio

The Share Exchange Ratio shall be as follows:

(a) equity shares of rupees two only each, credited as fully paid up in the BoB for every equity shares of the face value of rupees ten only each held in the Vijaya Bank issued and allotted to the equity shareholders of the Vijaya Bank whose names are recorded in the register of members of the Vijaya Bank as on the date determined by the BoB for this purpose to be known as the record date.

(b) equity shares of rupees two only each, credited as fully paid up in the BoB for every equity shares of the face value of rupees ten only each held in the Dena Bank shall be issued and allotted to the equity shareholders of the Dena Bank whose names are recorded in the register of members of the Dena Bank as on the date determined by the Bank of Baroda.

Procedure for determining the Share Exchange Ratio

(i) The Bank of Baroda, Vijaya Bankand Dena Bankshall each separately and independently appoint one accounting firm (Independent Valuer) to undertake an independent valuation of the shares of the relevant banks to determine Share Exchange Ratio.

(ii) The Independent Valuers shall issue joint valuation report proposing the share exchange ratio (Joint Valuation Report) for each of the Transferor Banks.

(iii) The Bank of Baroda, Vijaya Bank and Dena Bank shall each separately and independently appoint one category I Merchant Banker registered with the Securities and Exchange Board of India to give separate fairness opinions on valuation done by the independent valuers to the respective bank (Fairness Opinion).

(iv) The audit committees of each of the Bank of Baroda, Vijaya Bankand Dena Bankshall consider the Share Exchange Ratio and provide its recommendations to the Boards of the Bank of Baroda, Vijaya Bankand Transferor Bank 2, after taking into consideration the joint valuation report and the fairness opinion issued to the respective banks.

(v) After taking into consideration the recommendations of the respective audit committee, the joint valuation report and the fairness opinion issued to the respective banks, the Boards of the respective banks shall approve the Share Exchange Ratio suggested by the independent valuers which in the opinion of the Boards of the respective banks is fair and reasonable.

(vi) The Share Exchange Ratio shall be notified by each of the respective banks to the stock exchanges on which shares of such bank are listed and the date of such notification to be known as the Swap Ratio Announcement Date.

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