HDFC and its subsidiary HDFC Bank will merge today, July 1. The boards of the two entities approved the move on June 30. In a regulatory filing, the company revealed the details of the move. “Saturday, July 1, 2023, to be the ‘Effective Date’ of the Scheme, on which date the certified order of the NCLT sanctioning the Scheme will be filed by HDFC Investments, HDFC Holdings, HDFC Limited and HDFC Bank with the RoC,” the filing stated. This marks the end of over a year-long process to merge the two firms.
After the merger, HDFC Bank will be completely owned by public shareholders. People who hold a stake in HDFC will be able to swap their shares in the ratio of 42:25 for that of HDFC Bank. This means that for every 25 shares a shareholder of HDFC holds, they will get 42 shares of HDFC Bank.
As per a report in PTI, the merger of HDFC Bank and HDFC creates the fourth largest lender in terms of equity market capitalisation. The net worth of the merged entity will be over Rs 4.14 lakh crore.
With all the interest around the merger, let’s look at the timeline of the HDFC-HDFC Bank merger:
Approval of HDFC-HDFC Bank merger-April 4, 2022
On this date, HDFC Bank’s board of directors approved the scheme under Sections 230 to 232 of the Companies Act, 2013 (‘Companies Act’). A letter regarding the same was released by the bank.
HDFC-HDFC Bank merger sanctioned- April 23, 2023
In April this year, the Mumbai bench of the National Company Law Tribunal (NCLT) sanctioned the HDFC-HDFC Bank merger. The bench also gave approval for an extension of filing the order with the Registrar of Companies for a period of 90 days from April 27 so that HDFC and its subsidiaries could obtain the pending approvals they needed.
HDFC-HDFC Bank merger approved- June 30, 2023
The board of directors approved the merger of the HDFC Bank-HDFC. The board also revealed record dates under the merger.
HDFC-HDFC Bank merger: The road ahead
As per the HDFC filing, the commercial papers of HDFC Limited will be transferred to HDFC Bank on July 7. The non-convertible debentures of HDFC Limited will be transferred in the name of HDFC Bank on July 12.
July 13 has been chosen as the date on which HDFC Limited shareholders will be allotted the shares of HDFC Bank. On this date, the “continuation of warrants of HDFC Limited in the name of HDFC Bank” will also start.
(Edited by : Sudarsanan Mani)
First Published: Jul 1, 2023 11:35 AM IST
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