(Reuters) -IDFC First Bank said on Monday its board had given the green light for a merger with IDFC Ltd, just days after the landmark $40 billion merger between Housing Development Finance Corp and HDFC Bank came into effect.
IDFC Ltd shareholders will receive 155 shares of IDFC First Bank for each set of 100 shares they currently own in IDFC Ltd, according to an exchange filing.
The boards of Housing Development Finance Corp and HDFC Bank on Friday approved July 1 as the effective date of the two financial behemoths’ merger, the largest in India’s corporate history.
IDFC First Bank said its proposed deal would boost the bank’s standalone book value by 4.9% as of March 31, 2023 and aims to increase its balance sheet by 20-25% per year in the near to medium term.
It added that the proposed merger will unify IDFC FHCL, IDFC Ltd and IDFC First Bank, simplifying their corporate structure and easing regulatory compliance.
The deal is subjected to obtaining approvals from key regulatory bodies including India’s central bank and stock exchanges.
The merger will also eliminate promoter holding, IDFC First Bank said.
(Reporting by Akriti Sharma and Siddhi Nayak; Editing by Shailesh Kuber and Maju Samuel)
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