KeyCorp (KEY) shares jumped Monday morning after announcing that Bank of Nova Scotia (BNS) acquired a 14.9% stake in the bank valued at approximately $2.8 billion.

Scotiabank will buy about 163 million shares in two transactions, the first being an $800 million investment later this month. After the companies receive approval from regulators and the Federal Reserve, which is expected to happen in the first quarter of 2025, Scotiabank will invest an additional $2 billion in KeyBank.

KeyCorp takes advantage of “unique opportunity to raise capital on attractive terms”

“Scotiabank presented us with a unique opportunity to raise capital on attractive terms,” ​​said Chris Gorman, CEO of KeyCorp. “We remain comfortable with our current capital position, but have determined that the investment will enable Key to accelerate our well-communicated capital and earnings improvement while strengthening our strategic position,”

Scotiabank will buy shares at a fixed price of $17.17 per share, representing a premium of approximately 17.5 percent over Friday’s closing price of $14.61.

KeyCorp shares recently rose about 13%, reaching levels not seen since early 2023. Scotiabank shares fell about 4%.