Competition Commission of India (CCI) has approved the proposed merger of HDFC Bank and HDFC Ltd. The commission informed about this decision in a tweet on Friday.
Competition Commission of India (CCI) has approved the proposed merger of HDFC Bank and HDFC Ltd.
The Competition Commission of India (CCI) has approved the proposal of HDFC Bank and HDFC Ltd. Fusion Permission has been granted. The commission informed about this decision in a tweet on Friday. The commission said that the proposal for merger of HDFC Limited, HDFC Bank, HDFC Investments and HDFC Holdings has been approved. HDFC Limited had announced this merger plan in April itself.
In the first phase, HDFC Investments and HDFC Holdings will be merged into HDFC Limited. Then, in the second phase, that amalgamated company will be merged with HDFC Bank.
For acquisition of stake beyond a certain limit, companies need to get approval from the Competition Commission.
What will be the benefit to the shareholder
After the deal, every HDFC shareholder will get 42 shares of HDFC Bank. In the observation letter of BSE, it has been said that HDFC Bank has been asked for details of every action of SEBI which has taken place against any of its companies earlier. If any action has been taken against the director, promoter and promoter group, then information has also been sought. This detail has to be submitted to NCLT. HDFC Bank has been told that no changes will be made in the draft scheme of merger without the permission of SEBI. If any modification is to be done then written permission will have to be taken from SEBI.
how big will the business be
After the merger, according to the balance sheet of December 2021, the combined balance sheet of both the companies will be Rs 17.87 lakh crore and the net worth will be Rs 3.3 lakh crore. As of April 1, 2022, HDFC Bank had a market value of Rs 8.36 lakh crore (USD 110 billion) and that of HDFC was Rs 4.46 lakh crore ($59 billion). After the merger, HDFC Bank will be twice as big as ICICI Bank, which is now the third largest bank.
Earlier in July, a no-objection certificate was received from the stock exchange to merge the two companies. After the merger of the two companies, this will be the biggest transaction in the corporate history of India. The stock exchange had issued a no-objection certificate to HDFC and HDFC Bank.
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