HDFC and HDFC Bank Merger –
HDFC is an Indian financial services company which is leading provider of housing finance in India and HDFC Bank is an Indian banking and financial services company which is India’s largest private sector bank by assets and world’s 10th largest bank by market capitalization.
HDFC announced that its board has approved that the merger of its entirely owned subsidiaries HDFC Investment Limited and HDFC Holdings Limited with HDFC Bank Limited. Post this merger HDFC Limited will own 41% stake of HDFC Bank and HDFC Bank will be 100% owned by public shareholders. Shareholders of HDFC Limited will receive 42 shares of HDFC Bank for 25 shares held, under this deal.
HDFC Bank has total assets of Rs 19.38 Lakh Cr and HDFC Limited has total asset of Rs 6.23 Lakh Cr. This merger will help HDFC Bank to increase its bank’s product portfolio and ability to cross sell also it will help HDFC to accelerate the pace of credit growth. HDFC and HDFC Bank merger will create meaningful values for its stakeholders.
HDFC and HDFC Bank merger process will take 1-2 years because of numerous approvals. Due to this news both the stocks of HDFC Limited rose to 14% to high of 2804 and HDFC Bank rose to 10% to high of 1660 on BSE.