New Delhi, July 01: HDFC Bank, in what is being hailed as the largest transaction in the history of India Inc, is set to acquire its parent company, the prominent housing finance firm HDFC, on Saturday. This reverse merger will lead to the dissolution of the country's pioneering home finance company.
Here are 10 key points about this significant development:
1. HDFC Bank's merger with its parent company, HDFC, is being hailed as the largest transaction in India's corporate history.
2. This historic merger will place an Indian company among the world's most valuable banks, posing a new challenge to the leading American and Chinese lenders.
3. The deal, valued at $40 billion, creates a financial services giant with combined assets exceeding ₹18 lakh crore.
4. The new HDFC Bank entity will cater to an astounding customer base of approximately 120 million, surpassing the population of Germany.
5. The merged bank will boast an expanded branch network of over 8,300 and employ more than 177,000 individuals.
6. With an equity market capitalization of around $172 billion, the merged HDFC Bank ranks fourth globally, trailing only JPMorgan Chase & Co., Industrial and Commercial Bank of China Ltd., and Bank of America Corp.
7. The consolidated entity's total business as of March 2023 stood at ₹41 lakh crore, with a net worth exceeding ₹4.14 lakh crore and combined profits of about ₹60,000 crore.
8. The HDFC twins will hold significant weightage on the indices, accounting for nearly 14% compared to the current heavyweight, Reliance Industries, at 10.4%.
9. Surpassing major international banks like HSBC Holdings Plc and Citigroup Inc., HDFC Bank also outperforms its Indian counterparts, State Bank of India and ICICI Bank, in terms of market capitalization.
10. This merger signifies the transformation of HDFC Bank into a comprehensive financial services conglomerate, offering a wide range of products including banking, insurance, and mutual funds through its subsidiaries.
The newly formed HDFC Bank will have subsidiaries such as HDFC Securities Ltd, HDB Financial Services Ltd, HDFC Asset Management Co Ltd, HDFC ERGO General Insurance Co Ltd, HDFC Capital Advisors Ltd, and HDFC Life Insurance Co Ltd, further diversifying its offerings.
- With inputs from agencies
