Centurion Bank has filed the results of the shareholders' meeting, which was held on June 14, 2003, with the Goa bench of the Bombay high court.

The shareholders of the bank approved the scheme of arrangement between Bank Muscat and Centurion Bank.

They also approved the reduction in the paid-up share capital of the bank and the consequent amendments to the memorandum and articles of association.

Bank Muscat will merge its Bangalore branch operations with Centurion Bank. The bank will invest Rs 75 crore (Rs 750 million), including the merger of its Bangalore branch operations, in Centurion Bank.

The net worth of the branch operations after adjusting cash and cash equivalents has been anticipated at Rs 15 crore (Rs 150 million).

Centurion Bank has appointed KPMG to value the Bangalore operations. A transition team led by Sabre Capital's director Nigel Kenny will look at the transition process of the merger with Centurion Bank.

Bank Muscat will have three representatives on the board of Centurion bank, while the Sabre Group will have three representations including Rana Talwar as the chairman of the bank.

The issued, subscribed and paid-up capital of the bank will be reduced from Rs 152.47 crore (Rs 1.52 billion) to Rs 15.247 crore (Rs 152.47 million) with a face value of Re 1 per share. The reduction shall be effected by cancelling Rs 9 per equity share.

The court will now write to the Registrar of Companies to get its no-objection certificate. After the approval from the ROC, the court will pass the final order. The company will then decide on an effective date for the scheme.

Within 15 days of the effective date, the Sabre Investor Group and others will bring in Rs 154 crore (Rs 1.54 billion) as the first tranche of equity into the bank. The capital adequacy ratio of the bank was at 1.95 per cent as on March 31, 2003.

This is likely to move up to around 7 per cent when a capital infusion of Rs 154 crore (Rs 1.54 billion) will be made by investors led by the Sabre Group and will go up to around 9 per cent on the back of the Rs 65 crore (Rs 650 million) rights issue.

The rights issue is likely to take place in November. Bank officials are expecting the first tranche of money to come in around the end of September.