IDFC First Bank on Monday announced its plans to merge with its parent IDFC Ltd with an all-stock transaction, marking yet another major banking deal in the Indian banking sector days after the completion of HDFC Ltd and HDFC Bank valued at Rs 3.2 lakh crore.

The bank did not provide the total valuation of the merged entity, but based on Monday’s closing price of the two companies, the valuation is speculated to be Rs 71,767 crore. 

As per the filings made, the merger is subjected to the approval of shareholders and regulatory authorities such as the Securities and Exchange Board of India (SEBI), Reserve Bank of India (RBI) BSE Limited, the Competition Commission of India, the National Company Law Tribunal, and the National Stock Exchange of India Limited (NSE).

The share allotment arrangement has also been clarified under the proposed merger; an IDFC shareholder will be given 155 shares for every 100 shares he/she holds in the firm. According to the statement given by IDFC First Bank, the face value of both stocks are Rs 10 each. The bank also confirmed that the board of directors had approved the proposed manner of transactions. 

IDFC First Bank’s market capitalisation stood at Rs 54,311.48 crore at yesterday’s close. 

V Vaidyanathan, MD & CEO of IDFC First Bank, commented on the development, said, “We have built a strong deposit franchise, digital innovation, customer-friendly products, strong capital buffer, growing profitability and high corporate governance.”