HDFC Bank merger with HDFC Ltd

1 month ago 16

HDFC Bank has said that the proposal for merger with the parent company has been approved by the stock exchanges Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).

HDFC Bank & HDFC Merger Plan: The way for the merger of the private sector giant HDFC Bank with the parent company HDFC seems to be clear. HDFC Bank has said that the proposal for merger with the parent company has been approved by the stock exchanges Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). The bank has got no adverse observation from BSE and no objection from NSE. The bank has given this information in the BSE filing. Let us tell you that the proposal of merger of both the companies came to the fore in April this year.

HDFC Bank said that the proposal has been approved by the stock exchange. However, the proposal for merger of HDFC Bank and HDFC is subject to various statutory and regulatory approvals including, inter alia, approvals from the Reserve Bank of India, Competition Commission of India, National Company Law Tribunal and the respective shareholders and creditors of the companies involved in the scheme.

what is the merger plan

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.

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