Scotiabank To Buy 14.9% Stake In KeyCorp For $2.8 Bln In Cash

(RTTNews) - Scotiabank (BNS.TO, BNS) announced on Monday that it has inked a deal to acquire around 14.9 percent pro-forma ownership stake in KeyCorp, a financial services firm, through an issuance of shares at $17.17 per share. The total cash consideration stands at around $2.8 billion.

The share price represents an 11 percent premium to the volume weighted average price for the last 20 trading days.

Scotiabank expects the transaction to be accretive to its earnings per share in the first full year upon the closing of the additional investment.

The Initial investment of 4.9 percent is projected to be closed in the fourth quarter of fiscal 2024, while the additional investment of around 10 percent in fiscal 2025.

Scott Thomson, CEO of Scotiabank, said: "This strategic investment in KeyCorp, a premier bank in the U.S., significantly increases the capital deployed to our identified priority markets."

KeyCorp is operating across 15 states, with $187 billion in assets and around 1,000 branches offering commercial and retail banking, investment advice, and others.