Mumbai, April 27 :     Standard Chartered has bought Grindlays' Middle East and South Asian operations for $1.34 billion in cash from Australia and New Zealand banking group (ANZ). The merger will make Standard Chartered the leading foreign bank in India, Pakistan and Bangladesh. The deal is expected to be completed by the third quarter of 2000. The total cost, to be established by an audit, includes goodwill of $750 million. The price, excluding dividends, represents a multiple of 2.3 times Grindlays' book value of $590 million. The merger follows Standard Chartered's recent acquisitions of UBS International Trade Finance Business and Nakornthon Bank in Thailand. Stanchart sources here said Grindlays will feature in the new name of the merged entity because of the tremendous brand equity in the country. Grindlays, a former British colonial bank that was set up in 1850, has very strong links with Calcutta where it set up its first branch in 1854. The main offices of the bank - an imposing colonial structure - was set up on Clive Row (now Netaji Subhas Road) in 1863 and the logo of the prancing elephant was an enduring symbol of solidity and old-style British values. Even after the merger with ANZ in the late eighties, it continued to sport the Grindlays name in its India operations because of the strong values that the brand represented. In London, Stanchart chief executive Rana Talwar said: 'This acquisition is completely in line with our stated strategy and is a significant step towards our objective in becoming the world's leading emerging markets bank..' Describing the merger as a 'win-win' for both groups, ANZ boss John McFarlane said: 'The sale is a good outcome for shareholders, customers and staff of both banks.' 'For ANZ, the sale generates immediate value for our shareholders and enables us to simplify and focus our international operations in one move. For Standard Chartered, it creates the leading international bank in the Middle East and South Asia, and it will benefit from the growth and synergies the integrated platform will bring,' he added. In India, ANZ Grindlays' strength is corporate and investment banking while Stanchart has a headway in retail banking and treasury business. Stanchart has about 1,700 staff spread over 19 branches in eight cities while Grindlays employs over 3,000 across 19 branches in 15 cities. But there is a potential wrinkle in the fabric because of the huge unresolved liability of over Rs 900 crore arising from the securities scandal involving Harshad Mehta. Grindlays offers a wide range of services through 116 branches in 13 countries across the Middle East and South Asia, focusing on retail banking and cash management for major local corporates and multinationals. The combined business will have around 9,000 employees and 116 branches in 17 countries with over 2.2 million customers.