Capital First effectuates merger with IDFC Bank
The merger between IDFC Bank and Capital First was effectuated on December 18 and the merged entity will be christened IDFC First Bank. The stocks of IDFC Bank and Capital First were trading up more than 2 per cent on Wednesday.
Upon completion of the merger, IDFC Bank’s Board approved the appointment of V. Vaidyanathan, the existing Founder and Chairman of Capital First, as the Managing Director and Chief Executive Officer of the merged entity, subject to shareholders’ approval. It also permitted the appointment of Dr. Rajiv Lall, the existing Founder MD & CEO of IDFC Bank, as Part-time Non-Executive Chairman of IDFC First Bank, subject to approval from the RBI.
IDFC First Bank will provide a diverse range of retail and wholesale banking products, services and digital innovations to various high-growth customer segments. With 203 bank branches, 129 ATMs, 454 rural business correspondent centres spanning across India’s urban and rural geographies, the company has the opportunity to serve a whopping 7.2 million customers.
The Boards of both IDFC Bank and Capital First conducted a meeting to keep abreast of all the obligatory approvals and the order from the National Company Law Tribunal. They also sanctioned the effective date of the scheme of amalgamation. The restructured Board of IDFC First Bank stands expanded with the introduction of five new directors.
The merged entity has on-book loan assets of Rs. 1,02,683 for the quarter ended September 30, 2018. The retail book will now amount to 32.46 per cent of the overall loan book. The terms of the merger are such that shareholders will receive 139 shares of IDFC Bank for 10 shares held in Capital First Ltd.
On Wednesday, the shares of IDFC Bank opened at Rs. 42.35 per share and hit a high and low of Rs. 42.50 and Rs. 41.00, respectively. At 11:53 am, the stock was trading at Rs. 42.20, up 2.68 per cent. Similarly, the shares of Capital First opened at Rs. 581.00 and was trading at Rs. 581.00, up 2.32 per cent.