Capital First and IDFC Bank shares rallied 5 percent intraday Wednesday after the both companies announced completion of their merger on Tuesday. Both shares had also gained 5 percent each in previous session.
"IDFC Bank and Capital First merged effective December 18, 2018. Merged entity to be called IDFC First Bank, subject to shareholders' approval," the companies said in a joint statement.
Following the merger, the board of IDFC Bank approved the appointment of V Vaidyanathan, founder and chairman of Capital First Ltd, as Managing Director and Chief Executive Officer of the merged entity, said the statement. His appointment awaits shareholders' approval.
Earlier in the day, the boards of IDFC Bank and Capital First met to take note of all requisite approvals and the order from National Company Law Tribunal; and approved the scheme of amalgamation, the statement said.
The board of IDFC Bank also approved appointment of Rajiv Lall, Founder MD & CEO of IDFC Bank, as part-time non-executive chairman of IDFC First Bank, subject to approval from the RBI.
The reconstituted board of the merged entity now stands expanded with the induction of five new directors.
The merger between the two entities was announced on January 13, 2018. As part of the merger agreement, shareholders will receive 139 shares of IDFC Bank for each 10 shares held of Warburg Pincus-backed Capital First.
On a combined basis, IDFC First Bank has on-book loan assets of Rs 1,02,683 crore. The retail loan book will now contribute 32.46 percent to the overall loan book, said the statement. (with inputs from agency)
At 12:40 hours IST, IDFC Bank scrip was quoting at Rs 43.15, up Rs 2.05, or 4.99 percent and Capital First was up 4.64 percent at Rs 594.15 on the BSE.
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