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What is Merger?
A merger is when you integrate the business with another and share control of the combined businesses with other owner. A merger involves the mutual decision of two companies to combine and become one entity. i.e. a + b = c
Merger: 2 firms combine all Assets and Liabilities Acquirer Target Usually take a new name
What is Acquisition?
Acquisition may be defined as an act of acquiring effective control over assets or management of a company by another company without any combination of businesses or companies. i.e. a + b = a
August 14, 2004, GTB was amalgamated with Oriental Bank of Commerce
GTB has spread its higher deposit rates over its lending rates
GTB focused its lending to the small and medium companies, which could be charged higher rate of interest Within SMEs, GTB focused on exporters of garments, diamonds, IT, pharmaceuticals etc and give loans at higher interest rates
share price
1995
96
97
98
99
2000
01
02
03
Achievement
OBC crosses business of Rs 2 lac crore NP Rs 1000 crs reaches 1134.68 crs growth 25.32 % Operating profit Rs 2412.50 crore Branch Network1500 ATM Network 1000 Client Base 13.5 million Dividend for the year @ 91%
Credit Schemes Social Banking Corporate Banking Business Sector Flexi Fixed Deposit Scheme
Ranked among top 50 companies by the leading financial daily, Economic Times. Ranked as 323rd biggest bank in the world by Bankers Almanac (January 2006), London. Earned 9th place among India's Most Trusted top 50 service brands in Economic Times- A.C Nielson Survey. Included in the top 1000 banks in the world according to The Banker, London.
GTB
32.76 26.5 69.21 -2.73 9.16 6.48 25.8 19.8 87 1,314 0.0
OBC
156.77 147.8 298.09 4.57 11.46 2.25 6.9 1.4 989 13,507 14.0
Combined
189.53 174.3 367.3 ---20.62 8.73 10.8 4.6 1076
----12.2
Benefits to OBC
Additional104 branches Additional 275 ATMs And a workforce of over 1400 employees GTBs shareholders would not get OBC shares Tax benefits The face value of GTB shares from Rs 10 to Re 1 Willing to pay a 6:1 swap value
Benefits to GTB
Equally beneficial for GTB depositors Enjoy the trust of a public sector bank. Immense success of public sector banks in India. The interests of GTB's depositors were safeguarded, its shareholders (51 per cent of its equity is held by small investors)
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