A first in India’s banking industry, two small finance banks AU Small Finance Bank and Fincare Small Finance Bank will get merged.
The Board of Directors of AU Small Finance Bank in its meeting held on 29th October has approved the merger of Fincare small Finance Bank with AU Small Finance Bank. The bank informed the exchanges on Sunday late evening.
The transaction is subject to approval of the respective shareholders of both companies, the Reserve Bank of India and India’s competition regulator.
The transaction is also subject to capital infusion of ₹700 crore from promoters of Fincare Small Finance Bank.
Appointed date of the transaction shall be February 1, 2024 or any other date mutually fixed by both companies and approved by the RBI.
As per the deal, AU Small Finance Bank will issue 579 shares of the bank for every 2,000 shares held by shareholders of Fincare, or one share of the bank for every 3.45 shares of Fincare.
Post the transaction, existing shareholders of Fincare will hold 9.9% stake in AU Small Finance Bank.
