COPENHAGEN (Reuters) -Islandsbanki on Wednesday announced that its board of directors will contact Kvika banki to request the start of merger talks between the two companies, saying that a combination
Islandsbanki requests merger talks with Kvika Banki
COPENHAGEN (Reuters) -Iceland's Kvika Banki said on Wednesday it would review a request from Islandsbanki to initiate merger talks in order to determine its next steps, after it received a similar offer from Arion Banki on Tuesday.
Islandsbanki said in a separate statement on Wednesday that a combination of the two companies could benefit Iceland's financial system and the merger discussions should take place based on the market value of both.
Shares in Kvika Banki surged almost 11% before trimming gains to trade 8.5% up by 1018 GMT. Islandsbanki shares were up 0.8% and Arion Banki gained 2.5%.
Islandsbanki said it was willing to offer a 10% premium on Kvika's market capitalisation for the calculation of exchange ratios.
Kvika had a market capitalisation of 73.77 billion Icelandic crowns ($581.19 million), including its unlisted shares, according to LSEG data on Wednesday.
Arion Banki, another Icelandic bank, had on Tuesday also requested to start merger talks with Kvika, which Kvika said on the same day it would consider.
($1 = 126.9300 Icelandic Crowns)
(Reporting by Louise Breusch Rasmussen; Editing by Jan Harvey and Emelia Sithole-Matarise)
