After the merger, HDFC's warrants will be listed under the bank's name

23 Jun 2023 , 12:11 PM

Following the merger of HDFC Ltd. and HDFC Bank, outstanding warrants issued by the former would be listed and traded under the name of HDFC Bank because SEBI has modified a relevant rule regarding the listing of such warrants. The merger is anticipated to be finished the following month. 

The BSE and NSE told HDFC Bank that SEBI had granted a relaxation from the application of Rule 19(2)(b) of the SCRR, subject to the terms set forth therein. 

After the merger’s effective date and the warrants have been listed under the name of HDFC Bank, they will continue to be traded under that name starting on the trading date associated with that listing. Up until August 10, 2023, the holders of warrants will be able to swap their warrants for HDFC Bank equity shares using the share exchange ratio specified in the Scheme.

The following minimum offer and dilution requirements are prescribed for listing any class of equity shares under Rule 19 of the SCRR, which addresses the different requirements that a corporation should ensure for the listing of its securities on a recognized stock exchange. 

Equity warrants give their owners the right to convert these securities into shares at a predetermined price over a predetermined period of time in return for payment to the warrant’s issuance company. After they are exercised, the issuer issues the holders new shares. 

According to the statement, ‘HDFC Bank had, in relation to the proposed listing of warrants in the name of HDFC Bank, made an application to Securities and Exchange Board of India (‘SEBI’) through the stock exchange under Rule 19(7) of SCRR for relaxation of strict enforcement of Rule 19(2)(b) of the SCRR with respect to the outstanding listed warrants that have been issued by HDFC Limited and will continue in the name of HDFC Bank on the effective date of the Scheme (‘Effective Date’),’   

‘In this regard, we would like to inform you that BSE Limited (‘BSE’) and National Stock Exchange of India Limited (‘NSE’) have informed HDFC Bank that SEBI has granted relaxation from application of Rule 19(2)(b) of the SCRR via its letter dated June 21, 2023, subject to certain conditions mentioned therein.

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