Bank of Nova Scotia Acquires 14.9% Stake in KeyCorp

By Adriano Marchese

Bank of Nova Scotia has agreed to buy a minority stake in U.S.-based financial services company KeyCorp for $2.8 billion.

The Canadian financial institution said Monday that it will pay $17.17 a share to acquire a 14.9% pro-form ownership stake in the company.

Shares of KeyCorp have edged forward in 2024, gaining 1.5% since the beginning of the year and closing on Friday at $14.61.

Scotiabank said the offer price represents an 11% premium to the volume weighted average price for the last 20 trading days.

KeyCorp, which is based out of Cleveland, Ohio, operates about roughly 1,000 branches across 15 states and has $187 billion in assets. The company offers commercial and retail banking, as well as investment advice and services.

The acquisition is expected to be completed in two stages, beginning with an initial investment of 4.9% followed by an additional investment of about 10%, and Scotiabank expects the investment to be accretive to earnings per share in the first full year following the transaction's close.

The two-part deal is expected to close in the fourth quarter of fiscal 2024, and some time in fiscal 2025.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

August 12, 2024 06:33 ET (10:33 GMT)

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