With 7% discount deal\, Gruh-Bandhan Bank merger a growth key for the NBFC

With 7% discount deal, Gruh-Bandhan Bank merger a growth key for the NBFC

Loan growth and profitability have been, of late, put to test

Hamsini Karthik 

It’s a case of West meets the East with Bandhan Bank and Gruh Finance announcing their intentions of a merger. For every 1,000 share held in Gruh Finance, investors will get 568 shares in Bandhan Bank.

In other words, the swap ratio is a little less than 2:1. Since the swap ratio has been worked out on the basis of Monday's closing price, the deal is at a 7 per cent discount for Gruh Finance's shareholders. While this did take a few analysts by surprise, given the healthy return profile and superior asset quality of Gruh Finance, they attribute the discount to the ...

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First Published: Mon, January 07 2019. 23:42 IST