HDFC Bank approves Merger of Centurion Bank of Punjab (CBoP)

HDFC Bank has finally approved the acquisition of Centurion Bank of Punjab (CBoP) for Rs. 9,510 crore. It is considered as the largest merger in the financial sector in India. CBoP shareholders will get one share of HDFC Bank for every 29 shares held by them. After the merger, HDFC Bank would be at seventh position among the banks in India.

The boards of the two banks will meet on February 28, 2008 to consider the draft scheme of the merger, which will be subject to regulatory approvals. The HDFC Bank board will also consider making a preferential offer to its promoter, Housing Development Finance Corporation (HDFC), to enable it to maintain its shareholding in the merged entity.

CBoP’s Non-Executive Chairman Rana Talwar will be appointed the non-executive director of the merged entity, while its Managing Director and CEO Shailendra Bhandari will join the board as the executive director.