Aditya Birla Capital gets RBI nod for merger with Aditya Birla Finance – Banking & Finance News

Aditya Birla Capital on Wednesday announced that it has received Reserve Bank of India’s nod for the amalgamation of Aditya Birla Finance Limited, its wholly owned subsidiary, with itself to create a large unified operating NBFC. In a regulatory filing, Aditya Birla Capital said, “The company and amalgamating company have received letters dated 18 September 2024 from the Reserve Bank of India (RBI) whereby the RBI has accorded it’s ‘no objection’ for the Scheme.”

The amalgamation is expected to allow better access to capital, operational synergy and enhanced value creation for shareholders. “Aditya Birla Finance is the first among upper layer NBFCs to set a clear path for compliance with RBI’s scale based regulations,” it said in a statement. 

The company board had, earlier in March this year, informed the stock exchanges that it has approved the amalgamation. Later on 02 July 2024, it had received an observation letter with ‘no adverse observations’ from the BSE and an observation letter with ‘no objection’ from the NSE.

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Kumar Mangalam Birla, Chairman, Aditya Birla Group, had earlier said, “Our financial services business has scaled smartly to emerge as a core growth engine for the Aditya Birla Group. The proposed amalgamation will create a strong capital base for Aditya Birla Capital to grow its business and participate in India’s growth story, successfully fulfilling its commitment to empower the financial aspirations of millions of Indians.”

The company will now approach NCLT to complete the amalgamation process. “The Scheme remains subject to various statutory and regulatory approvals inter alia including approvals from the National Company Law Tribunal, other applicable authorities and the respective shareholders and creditors of the companies involved in the Scheme, as may be required,” it said. 

As of December 31, 2023, Aditya Birla Capital manages aggregate assets under management of about Rs 4.1 lakh crore with a total lending AUM of Rs 1,15,139 crore and gross written premium of Rs 13,500 crore in Life and Health Insurance businesses. 

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