IDFC and Shriram to rework on merger plans

India Infoline News Service | Mumbai | September 27, 2017 09:30 IST

IDFC Ltd and the Shriram Group decided to skip the merger plan worked out in July 2017, reported a leading news agency.

IDFC Ltd and the Shriram Group decided to skip the merger plan worked out in July 2017, reported a leading news agency. Shareholder pressure and dilution fears are said to have forced the two financial companies to examine a new, less complicated structure. Market participants would be interested in seeing what new merger plans will the two companies come up with.
 
The merger was proposed to transform IDFC bank from an infrastructure lender into a universal bank. The merger would have enabled the Piramal Group to enter into the commercial banking segment. The merged entity was going to offer the non-banking businesses of IDFC along with the Shriram Capital’s life and non-life insurance, retail broking and financial product distribution businesses.
 
Shriram City Union Finance (SCUF) was planned to merge with the IDFC Bank, followed by the holding company taking the ownership of Shriram Transport, according to market reports. The merger was further expected to expand the retail footprint of the IDFC Bank, as the company could utilise the SCUF’s strong presence in rural and semi-urban areas.

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