New Delhi:
Mortgage lender HDFC on Monday announced that it will merge with private lender HDFC Bank. “The share exchange ratio for the amalgamation of the Corporation (HDFC Ltd) with and into HDFC Bank shall be 42 equity shares (credited as fully paid up) of the face value of Re 1 each of HDFC Bank for every 25 fully paid-up equity shares of the face value of ₹ 2 each of the Corporation,” HDFC stated in a regulatory filing.
“The merger is subject to the receipt of requisite approvals from the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), the Competition Commission of India, the National Housing Bank (NHB), the Insurance and Regulatory and Development Authority, the Pension Fund Regulatory and Development Authority, the National Company Law Tribunal, BSE Limited and the National Stock Exchange of India Limited and other statutory and regulatory authorities, and the respective shareholders and creditors,” it added.
As of today, HDFC Ltd, along with two of its wholly-owned subsidiaries (HDFC Investments Ltd and HDFC Holdings Ltd), holds 21 per cent of paid-up equity share capital of HDFC Bank.
“HDFC Bank has access to funds at lower costs due to its high level of current and savings accounts deposits (CASA). With the amalgamation, HDFC Bank will be able to offer more competitive housing products. The proposed transaction will result in reducing HDFC Bank’s proportion of exposure to unsecured loans,” the mortgage lender further said.
