UBS Group said today (Monday) that it is expecting to close the acquisition of rival Credit Suisse Group "as early as 12 June," which will create a Swiss banking giant with a balance sheet of $1.6 trillion.

UBS and Credit Suisse Merger

"UBS expects to complete the acquisition of Credit Suisse as early as 12 June 2023. At that time, Credit Suisse Group AG will be merged into UBS Group AG," an official announcement stated on Monday.

"Completion is subject to the registration statement, which covers shares to be delivered, being declared effective by the US Securities and Exchange Commission, and to [the] satisfaction, or waiver by UBS, of other remaining closing conditions."

Upon completion of the merger, shares of Credit Suisse on the SIX Swiss Exchange and its American Depositary Shares on the New York Stock Exchange will be delisted. If the merger is finalized before the US trading hours on June 12, the ADS on the New York exchange will be delisted the same day, and shares on SIX will be delisted on June 13.

The announcement further elaborated that Credit Suisse shareholders will receive one UBS share for every 22.48 outstanding shares held. However, the exchange of the ADS on NYSE "may be subject to certain fees."

Credit Suisse received a notice of non-compliance from the NYSE last week as the price of the listed ADS went below 'an average closing price of at least $1 over a straight 30-day trading period'. In response, Credit Suisse said it "expects that the deficiency will be cured upon completion of the acquisition by UBS Group AG."

The Making of a Swiss Banking Giant

UBS agreed to acquire its arch-rival Credit Suisse on March 19 for 3 billion Swiss francs in a deal pushed by the Swiss government to avoid a crisis as seen recently in America that led to the collapse of several banks. Credit Suisse, which was reeling from controversies, lost investors' trust which led to a plunge in its share price and resulted in its acquisition to avoid a collapse.

The merger will make UBS one of the largest global banking groups. However, it will absorb the losses of Credit Suisse, which reported an adjusted pre-tax loss of CHF 1.3 billion in the first quarter of 2023. Furthermore, the net profits of UBS dropped 52 percent to $1.03 billion in Q1 due to a legal provision of $665 million.

Brokeree, Advance Markets partner; illegal brokers; read today's news nuggets.