The merger of HDFC Investments and HDFC Holdings into HDFC Ltd is effective today, the bank said. The boards have set July 12 as the record date for transfer of non-convertible debentures of HDFC Ltd in the name of HDFC Bank.
Effective July 7, all commercial papers of HDFC Ltd will be transferred in the name of HDFC Bank. According to the merger terms, eligible shareholders of HDFC will receive 42 new HDFC Bank shares for every 25 shares held by them in the former.
The bank has, however, not shared any date for delisting HDFC shares from the stock exchanges.
The completion of the mega merger was most awaited by Dalal Street investors, and the news will bring in a sigh of relief. In the run-up to the outcome of the board meeting, shares of both HDFC Bank and HDFC Ltd scaled 1-month highs on Friday.
Shares of HDFC Bank ended 1.5% higher on the National Stock Exchange at Rs 1,701.40, and those of HDFC Ltd closed 1.6% higher at Rs 2,821.95. Earlier this week, HDFC management had said they expect the merger to come into effect from July 1 subject to the approval of the boards.
Announced in April 2022, the merger of the two entities will create the fourth largest lender in the world by market capitalisation.
The market cap of the combined entity is estimated to be $172 billion, according to Bloomberg. Bank of America is the third largest with a market capitalization of $228 billion, while JPMorgan Chase is the largest in the world at $417 billion.
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