TAIPEI (Taiwan News) — Shin Kong Financial Holding (SKFH) and Taishin Holdings (Taishin FHC) approved a share swap merger plan in separate board meetings on Thursday (Aug. 22).

The merged entity will be known as "Taishin Shin Kong Financial Holdings." Taishin FHC will be the surviving company from the merger. 

Each SKFH share can be exchanged for 0.6022 Taishin FHC shares. Preferred stock will be exchanged one-for-one.

According to the first-quarter financial reports of this year, SKFH has total assets of NT$5.08 trillion (US$158 billion). Taishin FHC has NT$3.2 trillion. 

If successful, the combined entity would have NT$8.29 trillion in assets, ranking fourth among financial holding companies in Taiwan. It would also have the second-largest credit card market share.

As the Shin-Taishin merger progresses, CTBC Holding (CTBC) launched a public tender offer for SKFH on Wednesday (Aug. 20). The offer price has not been disclosed.

The Shin-Taishin merger requires approval from an extraordinary general meeting. The Financial Supervisory Commission (FSC) and the Fair Trade Commission must then approve the merger.

If CTBC acquires SKFH, the combined entity would surpass others to become the largest financial holding company in Taiwan. It would also solidify its position as the credit card market leader.

CTBC must first apply for approval from the FSC. The commission has 15 business days to review the application.

If the commission does not object, it is considered approved. CTBC can then start a tender offer.