Bank of Queensland has completed the final stage of a A$1.3 billion equity raising to fund its acquisition of ME Bank, announcing yesterday that the retail component of the entitlement offer closed after raising $682 million.
Following completion of the ME deal, BOQ’s total assets will increase from $56.8 billion to $88.3 billion and gross loans and advances will increase from $47 billion to $73.7 billion. Deposits will increase from $39.6 billion to $56.8 billion.
Customer numbers will increase from around 900,000 to 1.4 million.
The $1.32 billion acquisition price represents an implied acquisition multiple of 1.05 times ME’s 2019/20 book value and 11.9 times ME’s 2019/20 underlying cash earnings.
BOQ has forecast that the acquisition will be earnings per share accretive and return on equity accretive in the first full year of operation (2021/22).
One of the bank’s ambitions is to put all its brands – BOQ, Virgin Money and ME – on the same Temenos platform and develop an efficient digital strategy.