The merger plan of HDFC and HDFC Bank has received no objection from RBI. HDFC Bank has given this information in the BSE filing.
RBI is HDFC Bank & HDFC Merger Plan: Talks about the merger of the private sector giant HDFC Bank with the parent company HDFC have moved forward one more step. HDFC Bank has said that the proposal for merger with the parent company has been approved by bank regulator Reserve Bank of India (RBI). The bank has got no objection on this merger plan from RBI. HDFC Bank has given this information in the BSE filing. Prior to this, the merger plan has also been approved by the stock exchanges BSE and NSE. Let us tell you that the proposal of merger of both the companies was revealed in April this year.
What the bank said in the filing
HDFC Bank said in a BSE filing that it has received the approval of RBI, the regulator of the banking sector, for a merger proposal with its parent company HDFC Limited (HDFC). RBI has given ‘No Objection’ for this scheme, which is subject to certain conditions. This merger proposal is subject to various statutory and regulatory approvals including Competition Commission of India (CCI), National Company Law Tribunal (NCLT), other applicable authorities and the concerned shareholders and creditors of the companies. At present, the offer is touted as the largest transaction in the corporate history of India.
Approval has also been received from the stock exchange
Earlier, the merger plan of HDFC Bank and HDFC has been approved by the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). The bank has got no adverse observation from BSE and no objection from NSE. The bank had earlier given this information in its BSE filing.
HDFC Bank will be among the largest banks
After the merger with HDFC, HDFC Bank will become one of the largest banks in the world. This deal is worth about $ 6 thousand crore (Rs 4.53 lakh crore), which is the second largest business deal so far in 2022 this year. On completion of this deal, after the merger, the market cap of the bank can reach closer to $ 20 thousand crore (Rs 15.12 lakh crore). According to HDFC, the objective of this deal is to improve the housing loan portfolio of HDFC Bank and increase its existing customer base. At the same time, the housing finance business will also accelerate. This merger of HDFC and HDFC Bank is expected to be completed by the second or third quarter of the fiscal year 2024.
what will the shareholders get
Shareholders and creditors of the company will also be involved in this merger. Under the deal, HDFC Bank will be 100% owned by public shareholders. Whereas the existing shareholders of HDFC Limited will have 41 percent stake in HDFC Bank. HDFC shareholders will get 42 equity shares as per share exchange ratio in the combined company for every 25 equity shares.