Apr 04, 2022 12:22 pm
Housing Development Finance Corporation (HDFC) today announced merger with its owned subsidiaries HDFC Investments Limited and HDFC Holdings Limited with HDFC Bank Limited.
HDFC will acquire 41 percent stake in HDFC Bank through the transformational merger, as per their filing with the stock exchanges.
"This is a merger of equals. We believe that the housing finance business is poised to grow in leaps and bounds due to the implementation of RERA, infrastructure status to the housing sector, government initiatives like affordable housing for all, amongst others," Deepak Parekh, Chairman HDFC Limited, said.
"The resulting larger balance sheet would allow underwriting of large-ticket infrastructure loans, accelerate the pace of credit growth in the economy, boost affordable housing and increase the quantum of credit to the priority sector, including credit to the agriculture sector,” he added further.
The merger makes the mortgage offering of the combined entity even more competitive, he mentioned.
"Only after obtaining all regulatory approvals will the merger become effective. Post closing, HDFC Bank will be 100% owned by public shareholders. Shareholders of HDFC Ltd will own 41% stake in HDFC Bank post merger. Customers of HDFC and HDFC Bank will be the biggest beneficiaries," Deepak Parekh mentioned about the stake holders.
This merger would facilitate 7% more room for international investors mentioned Vice-Chairman and CEO Keki Mistry.