IDFC-Shriram kickstart 90-day merger talks
As per the proposed terms, Shriram City Union Finance and Shriram Capital will be merged with IDFC Bank.
Whereas, Shriram Transport Finance Company will continue to operate as a 100% subsidiary of IDFC and ultimately be delisted post the merger.
Similarly, the insurance business of Shriram will be transferred to IDFC, with IDFC holding close to 75% in both life and general insurance businesses.
The merger is still subject to several approvals from IRDA, SEBI, RBI, NSE and BSE and would take around 12 months for internal and regulatory approvals.
Shriram Capital chairman, Ajay Piramal on Saturday disclosed that it will be an arrangement for 90 days to jointly explore merger options, also adding that no valuations and transactions have taken place.
Post the merger, IDFC’s mutual fund arm would be integrated with Shriram Asset Management and also may be listed, IDFC Bank MD and CEO Rajiv Lall said.
Stock view :-
IDFC Ltd is currently trading at Rs 57.8, down by Rs 2.1 or 3.51% from its previous closing of Rs 59.9 on the BSE.
The scrip opened at Rs 60.5 and has touched a high and low of Rs 64.5 and Rs 57.1 respectively. So far 7458189(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs 9559.77 crore.
The BSE group 'A' stock of face value Rs 10 has touched a 52 week high of Rs 71.2 on 26-Oct-2016 and a 52 week low of Rs 50.2 on 26-Dec-2016. Last one week high and low of the scrip stood at Rs 62.75 and Rs 53.95 respectively.
The promoters holding in the company stood at 0 % while Institutions and Non-Institutions held 76.8 % and 23.2 % respectively.
The stock is currently trading below its 50 DMA.
IDFC Ltd :-
BSE 57.85 [2.05] ([3.42]%)
NSE 58.95 [1] ([1.67]%)
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