India's HDFC and HDFC Bank Merger Set to Take Place on July 1

28 Jun 2023 , 01:10 PM

Housing Development Finance Corporation (HDFC) and HDFC Bank are making significant progress towards finalizing their merger, targeting completion by July 1, according to an exchange filing by HDFC.

The boards of HDFC and HDFC Bank are scheduled to convene on June 30, which will also mark HDFC’s final board meeting. Following this, HDFC shares will be delisted from the market effective July 13, pending certain formalities.

These dates, however, are subject to change and depend on the completion of necessary procedures, as stated in the filing.

Once the board of directors of both entities determines the effective date of the merger scheme and the record date for share swapping, the information will be communicated to the stock exchanges.

The merger agreement, announced in April last year, involves a $40 billion deal between HDFC and HDFC Bank, creating a formidable financial services powerhouse to meet the growing demand for credit in India.

Under the terms of the agreement, HDFC shareholders will receive 42 shares of HDFC Bank for every 25 shares held, resulting in a 41% ownership stake in the merged entity.

Regulatory approvals for the merger have already been obtained from key authorities such as the Reserve Bank of India, National Company Law Tribunal, Pension Fund Regulatory and Development Authority (PFRDA), Securities and Exchange Board of India (SEBI), the Competition Commission of India, and India’s stock exchanges.

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