Australia's two major banks - Westpac and St George - agreed on merger terms, paving the way for the combined group to become Australia's biggest bank.
The announcement was made in a statement to the Australian Stock Exchange Tuesday morning.
The statement said the two organizations signed an agreement on Tuesday providing for a two week exclusivity period, during which the parties would undertake reciprocal due diligence, and negotiate the detailed terms of a merger implementation agreement.
According to the agreement, St George Bank shareholders will be offered 1.31 Westpac shares for each St George share, valuing their current holdings at a 28.5 percent premium to the stock's closing price last Friday, when they last traded.
A merged Westpac and St George would become the nation's biggest bank by market value and would have almost 10 million customers including businesses and 1,200 branches nationwide.
On Monday, it was announced that Westpac - Australia's second biggest bank - had approached fifth ranked St George after the close of the market on Friday about a merger.
Source:Xinhua
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