The Competition Commission of India (CCI) has approved the merger proposal of HDFC Bank and its parent HDFC Ltd. The proposed combination envisages the merger of HDFC Investments and HDFC Holdings with HDFC Ltd in the first step and subsequently, the merger of HDFC Ltd into HDFC Bank.
In a tweet on Friday, the CCI said it has approved the “proposed combination involving amalgamation of HDFC Limited, HDFC Bank, HDFC Investments and HDFC Holdings.”
In April, the country’s largest housing finance company HDFC Ltd announced that it will merge with HDFC Bank.
Deals beyond a certain threshold require approval from the regulator, which keeps a tab on unfair business practices in the marketplace.
Last week, HDFC said that an application was filed with the National Company Law Tribunal (NCLT) for merger of HDFC Investments Limited and HDFC Holdings Limited with HDFC Bank.
This was part of the proposed merger of HDFC Bank, the country’s largest private sector bank by balance sheet, with its parent HDFC.
The merger — seen as the biggest transaction in India’s corporate history — of the two financial services giants has already been approved in-principle by the RBI and stock exchanges.
A Joint Company Scheme remains subject to various statutory and regulatory approvals, including from NCLT, Competition Commission of India and the respective shareholders and creditors of the companies involved in the scheme as may be required, HDFC said in a regulatory filing.
In April this year, HDFC Bank and HDFC Ltd announced the merger proposal under which the bank will take over the mortgage lender for about USD 40 billion in around 18 months.
Last month, BSE and National Stock Exchange approved the merger. The RBI also accorded it’s ‘no objection’ for the merger of the bank with the mortgage lender.
The merger deal is yet to receive statutory and regulatory approvals from the Competition Commission of India (CCI) and the respective shareholders and creditors of the companies involved in the scheme.
