Kotak Mahindra Bank hits new high on acquisition of ING Vysya Bank

The stock rallied 14% in past two trading sessions on National Stock Exchange.

Kotak Mahindra Bank has surged 7% to Rs 1,242, extending its previous day’s 7% rally on National Stock Exchange (NSE), after the Kotak Mahindra Bank announced it was acquiring ING Vysya Bank in an all-stock deal.

ING Vysya Bank shareholders will get 725 Kotak Mahindra Bank shares for every 1,000 shares they hold.

This exchange ratio indicates an implied price of Rs 790 for each ING Vysya share based on the average closing price of Kotak shares during one month to November 19, 2014, which is a 16% premium to a like measure of ING Vysya market price.

The proposed merger would result in issuance of approximately 15.2% of the equity share capital of the merged Kotak.

Shares of Kotak Mahindra Bank has opened at Rs 1,206 and touched a fresh record high of Rs 1,265 on NSE.  The trading volumes on the counter more than doubled with a combined 1.78 million shares changed hands till 0923 hours on NSE and BSE.

Shares of ING Vysya Bank too up 1% at Rs 826 on NSE. The stock opened at Rs 825 and touched a high of Rs 845 so far. A combined one million shares changed hands on NSE and BSE.