ICICI Securities share price fell 3% to Rs 593.40 apiece as ICICI Bank approved a proposal to delist ICICI Securities, with the intention of making it a wholly-owned subsidiary of the bank. ICICI Securities was listed by the bank in an initial public offering that launched in April 2018, with shares being offloaded at Rs 520 apiece. Since then, the scrip has underperformed the broader markets. Over the last month, ICICI Securities stock price has gained 21.76%.
ICICI Securities delisting
The decision was made by the board of directors during their meeting held on Thursday. In a regulatory filing, ICICI Bank stated that the draft scheme of arrangement for the delisting of equity shares of ICICI Securities had been approved. The proposed scheme entails issuing equity shares of ICICI Bank to the public shareholders of ICICI Securities in exchange for the cancellation of their equity shares. Once the delisting process is complete, ICICI Securities will become a wholly-owned subsidiary of the bank, subject to obtaining the necessary approvals.
Delisting process
To materialize this transformative move, ICICI Bank will need to secure requisite approvals from its shareholders and creditors, as well as from regulatory authorities such as the Reserve Bank of India (RBI), the National Company Law Tribunal, BSE Limited, the National Stock Exchange of India Limited, and other statutory and regulatory bodies, as stipulated by applicable laws.
ICICI Securities acknowledged the strategic alignment between the bank and the company but clarified that a merger was not feasible due to regulatory constraints on the bank’s involvement in securities broking activities. The entire acquisition process, subject to the various regulatory approvals, is anticipated to conclude within the next 12-15 months.