HDFC and HDFC Bank’s merger will be effective from 1 July onwards. HDFC shares will stop trading and be delisted from the bourses on 13 July. Prior to the merger, both lenders will have a final board meeting each on 30 June, after office hours, to clear and approve the merger, said HDFC Bank Chairman Deepak Parekh. HDFC and HDFC Bank announced their merger plans last year, on 4 April. HDFC will obtain a 41% stake in HDFC Bank and the bank will be owned entirely by public shareholders. All HDFC’s subsidiaries will be moved under HDFC Bank’s banner.
HDFC-HDFC Bank merger to create a bigger behemoth
Experts project that following the amalgamation, the lending powerhouse will boast of an assets totalling Rs 18 lakh crore. The merged entity will be the second largest bank in India after SBI, and double the size of private lender ICICI Bank. “After 45 years in public finance, providing 9 million homes for Indians, we have to find a home for ourselves. And, we have found a home in our own family company HDFC Bank,” Deepak Parekh had said when plans for the merger were announced.
HDFC, HDFC Bank share price movement
HDFC Bank’s shares jumped 2.3% as Deepak Parekh and Keki Mistry announced the details of the merger at a press conference. Concurrently, HDFC stock price rose 2.6% to Rs 2,771 apiece. The combined market-capitalisation of the HDFC twins came in at Rs 14.4 lakh crore based on Monday’s market closing price. However, with a market-cap of Rs 16.9 lakh crore, Reliance Industries will continue to hold its position as India’s largest company. HDFC shareholders will receive 42 shares of HDFC Bank for every 25 shares of the non-banking lender held by them.