An extraordinary general meeting will take place on December 13, and already a 119-page circular has been published to its shareholders.
According to the circular, the existing shares in the hands of the shareholders are rendered void, a subsidiary is established in Ireland, and exchanges in the Athens Stock Exchange will end due to the fact that the bank conducts no banking activities in Greece.
Specifically, the addition of a new subsidiary company to the group will be achieved through a scheme that is agreed between the bank and its shareholders and includes the reduction of share capital.
The scheme will allow BOC Holdings to become the owner of the bank’s entire share capital. This will be done by rendering the current shares that shareholders own void.
After this step, shareholders will have the right to receive from BOC Holdings one new shares for every 20 shares they currently own.
With this scheme, BOC Holdings will own all the share capital of the bank.
The need for a majority
The scheme must be approved by the majority of shareholders which will be present at the General Meeting and will have the right to vote, either in person or through an authorised representative.
The capital decrease requires the approval of 75% of shares which will be present and have the right to vote either in person or through an authorised representative.
Both the scheme and the capital decrease require the validation and approval of the court during a court hearing.
It is important, it is stressed in the circular, that as many votes as possible are amassed so that the court can rule that the representation of shareholder opinion is just.
The timeline is as follows:
- 21 November: Date of publication of the circular
- 11 December: 10am deadline for the submission of paperwork to appoint an authorised representative
- 13 December: 10am Extraordinary General Meeting
- 21 December: Court hearing
Following the court hearing and the announcement of the court’s decision, the bank will make announcements. At least two days after the Bank’s announcement on the court decision will be the deadline to negotiate existing shares.
The date at which the scheme becomes effective and new shares are issues is at least seven working days after the issuance of the court decision, at least 8 working days for the start of negotiations of the new shares in the Main Market of the London Stock Exchange and the Cyprus Stock Exchange.
The date of March 31, 2017 is the last date by which the scheme may be made effective, unless Bank of Cyprus and BOC Holdings agreed on a later date, and the court allows it.