Bandhan Bank is in talks with HDFC Ltd to buy its subsidiary Gruh Finances, sources said.
Bandhan Bank has been asked by the Reserve Bank of India (RBI) to reduce its promoter holding and this move is seen as an effort to comply with this ruling. RBI has asked the bank to reduce its promoter holding from current 82.28 percent to 40 percent by August 2018. Post the deal, promoter holding in Bandhan Bank is likely to fall to 60 percent. “Bandhan will have to take more steps to fully comply with the RBi’s norms” an expert who wished not to be named, pointed out.
The deal, if goes through, will take Bandhan Bank's market capitalisation from Rs 63,000 crore to Rs 88,000 crore.
HDFC Ltd currently holds 57.86 percent stake in Gruh Finance and could hold up to 15 percent in the merged entity of Bandhan Bank and Gruh Finance. As per the RBI rules, HDFC Ltd will require an approval to own more than 5 percent in the new entity.
Market analyst Dipan Mehta said, “Deal is a win-win for both the companies, both are richly traded companies in terms of their valuations.”
HDFC Ltd, Bandhan Bank and Gruh Finance did not comment for the story.