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IBULHSGFIN - Indiabulls Housing Finance News Story

₹178.4 1.8  1.0%

Last Trade - 6:55am

Sector
Financials
Size
Mid Cap
Market Cap £780.8m
Enterprise Value £6.49bn
Revenue £990.6m
Position in Universe 324th / 3105

UPDATE 1-India's Lakshmi Vilas, Indiabulls Housing merge to expand footprint

Fri 5th April, 2019 3:40pm
(Adds merger details, company info, and analyst comments)
    April 5 (Reuters) - Indian private-sector lender Lakshmi
Vilas Bank Ltd  LVLS.NS  will merge operations with housing
finance firm Indiabulls Housing Finance Ltd  INBF.NS  in a
share-swap deal, the companies said in a filing https://www.nseindia.com/corporate/LAKSHVILAS_05042019172432_LrtoSE05042019_389.pdf
 on Friday.
    Shareholders of the Chennai-based bank will get 0.14 share
in Indiabulls for every share held in the lender, the companies
said.   
    The merger will create a large, healthy and diverse asset
book, Lakshmi Vilas Bank said. It will also allow the merged
company to collectively foray into newer businesses that help
increase fee income, the lender added.
    The joint company will have a net worth of 194.72 billion
rupees ($2.81 billion), as of Dec-end 2018, the housing finance
firm said, adding that the merger will lead to a stronger reach
as Indiabulls' exposure in the northern and western parts of the
country will combine with Lakshmi Vilas' foothold in southern
India.
    "It is a win-win deal for both the companies," said AK
Prabhakar, head of research, IDBI Capital in Mumbai.
    Lakshmi Vilas Bank had total assets worth 404.29 billion
rupees, as of March 31, 2018, while Indiabulls Housing had total
assets of 1.32 trillion rupees, as on December 31.
    "Indiabulls will get a banking tag, which will bring down
its cost of funds, so it is a bigger win for them. The merger
will give good branding and better pan-India presence for the
Tamil Nadu-based Lakshmi Vilas," Prabhakar added.
    Post the merger, Indiabulls founder and Chairman Sameer
Gehlaut will be the vice-chairman. 
    Meanwhile, Parthasarathi Mukherjee, managing director and
CEO, Lakshmi Vilas Bank, and Gagan Banga, Indiabulls'
vice-chairman and managing director, will be appointed as joint
MDs, Indiabulls said https://www.bseindia.com/xml-data/corpfiling/AttachLive/19c2ce0d-565f-4d64-b717-76e93efb3485.pdf.
    Indiabulls said https://www.bseindia.com/xml-data/corpfiling/AttachLive/a5cc5472-a13b-496b-a71c-bd4e6702abda.pdf
 it has formed a panel, headed by Independent Director SS Mundra
to oversee the proposed merger.
    The announcement was made after market hours. 
    Shares of Lakshmi Vilas closed 4.98 percent firmer on the
NSE index  .NSEI  on Friday, while Indiabulls Housing ended 0.6
percent higher.
    
    ($1 = 69.2060 Indian rupees)
    

 (Reporting by Krishna V Kurup in Bengaluru, Editing by Sherry
Jacob-Phillips)
 ((Reuters Messaging: Krishna.VKurup@thomsonreuters.com ; +91 80
6749 1310; Reuters Messaging:
Krishna.VKurup.thomsonreuters.com@reuters.net))
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