IDFC gets CCI nod for merger with IDFC First Bank

The Infrastructure Development Finance Company (IDFC) on Tuesday said that it had received approval from the Competition Commission of India (CCI) for its merger with IDFC First Bank. "...the CCI vide its letter dated today, i.e. October 17, 2023 has communicated that it has considered and approved the combination under Green Channel Route," IDFC said in a regulatory filing. 

Also Read: IDFC First Bank: Rajiv Jain's GQG acquires bank shares from MD & CEO V Vaidyanathan

The Boards of IDFC First Bank Ltd and IDFC Limited approved their merger with each other in July this year. The share exchange ratio for the amalgamation of IDFC Limited with IDFC First Bank shall be 155 equity shares of a face value of Rs 10 of IDFC First Bank for every 100 equity shares of face value of Rs 10 of IDFC Limited. 

As a result of the proposed merger, the standalone book value per share of the bank would increase by 4.9 per cent, as calculated on audited financials as of March 31, 2023, the lender had said.

On Tuesday, IDFC Ltd's scrip on BSE closed nearly one per cent higher at Rs 126.70 while IDFC First Bank's scrip on BSE closed 0.71 per cent higher at Rs 91.60.

"The merger will lead to simplification of the corporate structure of IDFC FHCL, IDFC Limited and IDFC First Bank by consolidating them into a single entity and will help streamline the regulatory compliances of the aforesaid entities. The merger will help create an institution with diversified public and institutional shareholders, like other large private sector banks, with no promoter holding," IDFC First Bank had said in a stock exchange filing.

Speaking on the proposed merger, Sanjeeb Chaudhuri, Chairperson, IDFC FIRST Bank, said that this was an important event for the bank and for all the shareholders of the bank as well as IDFC Limited. "We now embark on the next phase of our growth journey towards our long-term vision, and to create sustainable shareholder value in the years to come."

V Vaidyanathan, MD & CEO, IDFC First Bank, said: "With this merger, we are very happy to welcome all the shareholders of IDFC Limited to become direct shareholders of IDFC FIRST Bank. We have built a strong foundation for our Bank including a strong deposit franchise, digital innovation, customer-friendly products, strong capital buffer, growing profitability, and high corporate governance. We look forward to building on our vision to create a world-class Bank in India with the support of existing and new shareholders."