Finland: Meritanordbanken And Unidanmark Agreed To Merge

The Swedish-Finnish bank MeritaNordbanken moved on 6 March 2000 to create the Nordic region’s largest financial services group through an agreed EUR 4.78 billion takeover of Unidanmark, Denmark’s second largest bank. The merger will create a company with market capitalisation of EUR 15.6 billion, EUR 186 billion of assets, 9 million customers and 33.000 employees. The new company will be based in Sweden with its shares trading in Sweden, Denmark and Finland. The merger can be taken as the latest sign of a growing trend by banks in the Nordic region to expand beyond their relatively small domestic markets.

The MeritaNordbanken’s strong position in the Finnish, Swedish and Baltic markets combined with Unidanmark’s retail banking and insurance services will create a leading financial services group in terms of assets ahead of Svenska Handelsbanken of Sweden. The new company will have a 40 per cent share of the Finnish banking market, 25 per cent in Denmark and 20 per cent in Sweden. It will also have a 30 per cent share of Finnish life insurance market.

The merger is carried out by share exchange offer to give Unidanmark shareholders 30 per cent and MeritaNorbanken shareholders 70 per cent of the shares in the new company as 12.704 shares of MeritaNordbanken’s parent company, Nordic Baltic Holding, are offered for each Unidanmark share. Unidanmark shares are valued at DKR 505 and the whole of Unidanmark at DKR 35.6 billion. The Danish bank’s shareholders would also receive a special dividend of DKR 10 per one Unidanmark share subject to the completion of the exchange offer.

Electronic financial services, especially Internet banking, will be a key growth area of the group. The new bank will have 1.4 million Internet customers and according to MeritaNordbanken the merger provides "an excellent base for a rapid growth of electronic financial services."

MeritaNordbanken CEO, Hans Dahlborg, will also be the CEO of the new company while Unidanmark CEO Thorleif Krarup will take over the post next. According to Dahlborg, the banks were aiming for EUR 140 million of cost savings and EUR revenue synergies within three years.

For further information, please contact Pekka Lehtinen.

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