Merger Between IDFC Bank & IDFC

Published : 4 July 2023

By : Sachin Gupta

After HDFC Bank and Housing Development Finance Corporation, this is the second significant merger agreement in the financial industry.

The merger between IDFC First Bank Ltd. and IDFC Limited was approved by the boards of both companies on Monday i.e 3rd July 2023.

Through IDFC Financial Holding, IDFC Ltd. owns a stake of about 40% in IDFC First Bank. The public holds a 100% stake in IDFC Ltd.

 IDFC shareholders to get 155 shares of IDFC First Bank for every 100 shares held in IDFC.

It is anticipated that the merger will not negatively impact the bank's balance sheet or its paid-up share capital. When it becomes operational, IDFC First Bank will distribute shares to IDFC Ltd. stockholders as of the chosen record date.

The bank's standalone book value per share will rise by 4.9% as a result of the planned merger. A solid deposit franchise that the bank has established has grown at a CAGR of 36% over the last four years.

The Reserve Bank of India, Sebi, the Competition Commission of India, the National Company Law Tribunal, the stock exchanges, and all other statutory and regulatory bodies, as well as the shareholders of both the listed companies, must all approve the merger before it may proceed.