Indiabulls Firms to Merge Into LVBIndiabulls Housing Finance and its subsidiary Indiabulls Commercial Credit will be merged into Lakshmi Vilas Bank (LVB) after a change in the merger proposal announced late Friday. The new plan will likely make it easier for the entities to get regulatory approval even though terms of the union remain unaltered.“When we announced the scheme in April, both the options were open to us but after considering all options in the last few days, we have decided that both the Indiabulls companies will be merged
with LVB,” said Gagan Banga, managing director at Indiabulls Housing Finance. “All other things will remain the same and LVB shareholders will hold 9.5% in the combined entity.”Under the earlier scheme of amalgamation announced on April 5, LVB was supposed to be merged with Indiabulls Housing Finance, subject to regulatory approval. In a notice to stock exchanges on Friday, the Indiabulls units were described as transferor companies while LVB was described as a transferee company. By contrast, on April 5, LVB was described as the transferor company.The new deal envisages the merger of both Indiabulls companies into LVB on an ongoing basis
without being wound up. Indiabulls Housing shareholders will hold 90.5% of the post –merger enhanced equity capital of the merged entity and shareholders of LVB will hold approximately
9.5%, as in the previous deal.The merger is, however, still subject to regulatory approval.Analysts said the change in structure makes it easier for the deal to go through. “With LVB now being the acquiring entity, questions on the Indiabulls promoters passing the fit and proper criteria do not arise,” said Prakash Agarwal, head - financial institutions at India Ratings & Research. “The only question now is whether RBI will allow any individual group to hold more than 5% in the combined entity.” Indiabulls is an NBFC with substantial exposure to the realty and regulatory approval for this
transaction could open the doors for other NBFCs to acquire distressed banks — and deposit licences.
Birla Corp Q4 Net Declines by 2%
MUMBAI Cement and jute maker Birla Corporation reported a 2% decline in net profit for the quarter ending March, 2019 at ₹128.2 crore even as net sales went up by 13% at ₹1,873 crore, reports Our Bureau. Operating profit for the quarter stood at ₹334 crore, registering a jump of 15% riding on higher sales and better realisation. “A significant achievement of the quarter has been the turnaround in the performance of the Chanderia cement unit, despite low prices prevailing in the north markets by a series of cost reduction measures and marketing initiatives,”
the company said.
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