Equitas Holdings, Equitas Small Finance Bank stocks surge after receiving board, shareholder's approval for amalgamation

The share exchange ratio would result into each shareholder of the transferor company, EHL, getting 226 equity shares of the transferee company, ESFB, for every 100 shares held by them in the holding company.

Jul 27, 2021 02:07 IST India Infoline News Service

Shares of Equitas Holdings Ltd (EHL) and Equitas Small Finance Bank (ESFB) surged on Tuesday’s trade after the board of directors and shareholders have approved the amalgamation scheme of the two companies.

The share exchange ratio would result into each shareholder of the transferor company, EHL, getting 226 equity shares of the transferee company, ESFB, for every 100 shares held by them in the holding company.

Equitas Holdings Ltd is currently trading at Rs131.05 up by Rs6.6 or 5.3% from its previous closing of Rs124.45 on the BSE. The scrip opened at Rs130.55 and has touched a high and low of Rs136.80 and Rs128.60 respectively.

Equitas Holdings Ltd is currently trading at Rs65.25 up by 3.33% from its previous closing of Rs63.15 on the BSE. The scrip opened at Rs65.60 and has touched a high and low of Rs68.70 and Rs64.45 respectively.

The Scheme is subject to the following approvals:
  • receipt of approval from the Reserve Bank of India (“RBI”) as per applicable laws and such other directions, regulations issued by the RBI,
  • approval from SEBI for ESFBL to meet the minimum public shareholding requirements through the aforesaid Scheme
  • approval/ no-objection confirmation from Stock Exchanges under the applicable SEBI Regulations
  • approval of respective requisite majorities of the public shareholders and creditors of EHL and ESFBL as the NCLT may direct,
  • the sanction of the NCLT and
  • such other statutory and regulatory approvals, permissions and sanctions of regulatory and other authorities, as may be necessary.

The Appointed Date for the Scheme shall be November 1, 2021, or such other date as determined by the Board of ESFBL to comply with the approvals/directions from the regulatory and statutory authorities and the Scheme shall be operative from the Effective Date i.e. the date on which the authenticated copy or certified copy of the order of the NCLT sanctioning the Scheme is filed with the Registrar of Companies, Chennai, Tamil Nadu by EHL.  

Upon scheme becoming effective, the Bank will issue equity shares as mentioned in Sl.No. 5 above to the equity shareholders of the transferor company as on the Record Date as defined in the Scheme.

Considering that Transferor Company is a company with no identifiable promoter and all its shareholders are public shareholders, issue of shares under the Scheme would result in increase of public shareholding in the Bank from 18.25% as on June 30, 2021 to 100%, the company said.

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