The Athens-based financial institution, Eurobank, has entered an agreement to acquire the Greek real estate firm, Grivalia Properties.
The nation’s third largest bank’s all-share acquisition will value Grivalia at €780mn (US$886.7mn), Reuters reported.
The real estate company’s shareholders will be offered a 9% premium of the closing share price on 23 November.
Eurobank will offer 15.8 shares for each of Grivialia’s shares. The deal will also include a €40.5mn (US$46.04mn) dividend.
“The merger creates the best capitalized bank in Greece, with total capital ratio at 19%, ready to serve its clients, return to growth and support economic activity in Greece and Southeastern Europe,” stated the firms.
“The combined group is targeting strong sustainable earnings per share and over 10 percent return on tangible equity in 2020.”
Fairfax Financial Holdings, the Toronto-based holding company, will become the largest shareholder of merger, owning 32.93%.
The Canadian firm currently owns 18.23% of Eurobank and 51.43% of Grivalia.
Eurobank also revealed plans to reduce its ratio of non-performing loans down to 15% by the end of next year.