The State Bank of Vietnam has approved in principal the merger between Habubank and SHB.
Both banks have signed an MoU on the merger on March 7, 2012.
After the merger, Habubank will hand over all its assets and management to SHB, and the Habubank brand be replaced by SHB.
The two sides have agreed that 1.34 shares of Habubank will be equal to one share of SHB. New SHB shares will be issued to stockholders of Habubank.
SHB will be responsible for maintaining current contracts of all Habubank's employees, including benefits.
Habubank plans to hold a shareholder's meeting to ratify the merger by April 30, but timing of the actual merger depends on the final decision of SBV.
Afterwards, Habubank will not be able to take on any further debt or service responsibilities without the approval of SHB. Also, Habubank will not be allowed to increase pay for employees, contractors and service providers, or to make investments, unless they were agreements made before the signing of the MoU with SHB. They will also be restrained from liquidating assets without SHB approval.
After the signing of the MoU, neither side will be able to negotiate with a third party for another merger.
The SBV requested that the merger be conducted in accordance with circular No. 04/2010/TT-NHNN dated on February 11, 2010 on banking merging.
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