NCLT Reserves Order for Approval of Merger of HDFC and HDFC Bank
The National Company Law Tribunal (NCLT) has reserved the order for its approval of the Housing Development Finance Corporation
NCLT Reserves Order for Approval of Merger of HDFC and HDFC Bank
The National Company Law Tribunal (NCLT) has reserved the order for its approval of the Housing Development Finance Corporation (HDFC) and HDFC Bank merger.
With the arguments in respect of the merger concluded, no more hearing will take place in the matter.
Sources said that the order has been reserved for now and no further date for the hearing has been given by NCLT.
Reserving an order means that the NCLT has heard HDFC and HDFC Bank's counsels and needs time for the final judgement.
Before this, HDFC had already received the required approvals from the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), shareholders of HDFC and HDFC Bank, the Pension Fund Regulatory and Development Authority (PFRDA), the Competition Commission of India (CCI) and the Insurance Regulatory and Development Authority of India (IRDAI).
In addition to this, the company had also received a No Objection Certificate (NOC) from both stock exchanges.
The merger envisages the transfer of HDFC Mutual Fund’s ownership from the housing finance company to the bank. Under SEBI guidelines, the HDFC asset management company will have to seek consent from all unit-holders for the transfer of ownership. This process is expected to take several weeks.
On April 4, 2022, the HDFC-HDFC Bank merger was announced and is labelled as one of the largest mergers in India's corporate history. The merger, in terms of market capitalisation, is set to create the third largest company in the country, with the amalgamated entity estimated to have a combined asset base of around Rs. 18 lakh crore.
After the complete deal and merger, existing shareholders of HDFC will own 41 percent of the HDFC bank.