HDFC bank said on Monday that its board has approved the merger with HDFC Investments and HDFC Holdings Housing Development Finance Corporation Limited or the amalgamation of HDFC Ltd. and HDFC Ltd. into HDFC Bank. “The Board of Directors of HDFC Bank has also given its approval for the execution of an Implementation Agreement between HDFC Limited and HDFC Bank, which, inter alia, sets out the manner of carrying out the transactions proposed under the Scheme, which Representation and warranties are being given. The rights and obligations of each party and the parties concerned in respect of the proposed transaction,” the bank said in a BSE filing.
The share exchange ratio for amalgamation with HDFC Ltd. and in HDFC Bank will be 42 equity shares (fully paid-up) of face value of Re 1 each of face value of 25 fully paid-up equity shares of HDFC Bank. HDFC Ltd’s Rs.
Consequently, when the scheme is effective, HDFC Bank will be 100 per cent owned by public shareholders and existing shareholders of HDFC Ltd will hold 41 per cent of HDFC Bank.
HDFC, HDFC Bank merger will help HDFC Bank, know how
The proposed transaction, the bank said in a BSE filing, will enable HDFC Bank to build its home loan portfolio and grow its existing customer base. HDFC said, “This will also create meaningful value for various stakeholders as the combined business will benefit from increased scale, broader product offerings, balance sheet flexibility and ability to drive synergies across revenue opportunities, operational efficiencies and underwriting capacity.” ” Exchange filing.
“HDFC Bank will benefit from a larger balance sheet and net worth which will allow underwriting of big ticket loans and will also enable greater flow of credit into the Indian economy,” the bank said.
The scheme is subject to obtaining requisite approvals from the Reserve Bank of India (“RBI”), Securities and Exchange Board of India (“SEBI”), Competition Commission of India, National Housing Bank (“NHB”), etc. Insurance Regulatory and Development Authority of India, Pension Fund Regulatory and Development Authority, National Company Law Tribunal, SSE Limited and National Stock Exchange of India Limited (collectively, the “Stock Exchange”) and other statutory and regulatory authorities, and their respective
shareholders and creditors, subject to applicable law.
HDFC Twins has a market capitalization of Rs 13,83,498.26 crore, which is higher than TCS’s market value of Rs 13,75,071.51 crore. HDFC has total assets of Rs 6,23,420.03 crore, turnover Rs 35,681.74 crore and net assets Rs 1,15,400.48 crore as on December 31, 2021. HDFC Bank has a net worth of Rs 19,38,285.95 crore, net assets (including other income) of Rs 1,16,177.23 crore for the nine months ended December 31, 2021, and net assets of Rs 2,23,394.00 crore as on December 31, 2021.
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