Mortgage lender HDFC Ltd today said its board is considering raising funds through non-convertible debentures (NCDs) in consolidated tranches of Rs 57,000 crore.
“The meeting of the Board of Directors of the Corporation is scheduled to be held on Monday, March 27, 2023, to consider the issuance of various tranches of unsecured redeemable non-convertible debentures under the Memorandum of Incorporation of INR 57,000 crore in private placement. basis…,” HDFC said in a regulatory filing.
This was approved by the shareholders at the 45th annual general meeting held on June 30, 2022, according to the report.
Parent HDFC Ltd is expected to be merged into subsidiary HDFC Bank in the third quarter of the next financial year.
Touted as the largest transaction in India’s corporate history, HDFC Bank has agreed to take over the largest domestic mortgage lender in April 2022 in a deal valued at around $40 billion, creating a financial services titan.
The total assets of the proposed entity will be approximately Rs.18 crore. The merger is expected to close in the second or third quarter of FY24, subject to regulatory approvals.
After the transaction takes effect, 100 percent of HDFC Bank will be owned by public shareholders, while HDFC’s existing shareholders will own 41 percent of the bank.
Each HDFC shareholder will get 42 shares of HDFC Bank for every 25 shares held.
After the merger, the consolidated balance sheet as on December 2021 will be Rs 17.87 crore and net worth Rs 3.3 crore.
As of April 1, 2022, HDFC Bank had a market capitalization of Rs 8.36 crore ($110 billion) and HDFC Rs 4.46 crore ($59 billion).
Post-merger HDFC Bank will be twice the size of ICICI Bank, which is now the third largest lender.
(Except for the headline, this story was not edited by NDTV staff and was published on a syndicated channel.)