BoR moves papers to RBI for merger with ICICI

Bank of Rajasthan (BoR) has forwarded an application for merger with ICICI Bank to the Reserve Bank of India (RBI) -- a move that is expected to end the drama surrounding the Rs 3,000 crore deal after shareholders of BoR defied a court order and voted on the amalgamation proposal.

The move comes within two days of ICICI Bank approaching the RBI with the merger application.

"We have submitted all the relevant papers to the RBI as also the supporting document - scheme of amalgamation and other supporting documents to Reserve Bank on June 25 for its approval," BoR Chief Executive Officer and Managing Director G Padmanabhan told PTI over phone.

 

He was responding to a query if the BoR had filed an application with RBI last Friday for its merger with ICICI Bank.

On whether the filing of merger papers would imply that the BoR board, which met on June 24, had approved the decisions taken by the shareholders in the meeting on June 21 after the management adjourned the EGM due to a stay given by a civil court in Kolkata, Padmanabhan said: "We have given all the documents and it is for the RBI to take a call."

However, the civil court stay was vacated by the Calcutta High Court within hours that day.

When contacted, ICICI spokesperson told PTI from Mumbai that the bank had also moved the RBI on June 23 for merger with BoR.

Following the BoR board meeting on June 21, the RBI appointed CEO of BoR had said: "On the validity of voting, a lot of multiple view points and various legal opinions came up in the meeting. The Board has decided that the necessary papers for the amalgamation will be sent to RBI."

But this had left the issue of merger uncertain due to the doubts over the legality of  voting by the shareholders on their own.

After a chaotic start,  the management of Udaipur-based BoR said it was cancelling the meet following a stay obtained by an investor from a Kolkata court.

However, the shareholders elected a Chairman from among them and went ahead with the voting. Both BoR and ICICI Bank shareholders had voted in favour of the merger of the two entities at a swap ratio of 1:4.72.

On the same day, ICICI Bank’s EGM had approved the merger by an overwhelming majority. ICICI Bank last month agreed to take over Bank of Rajasthan in a share-swap deal that valued the Udaipur-based bank at over Rs 3,000-crore.

The integration would help ICICI Bank increase its branch network by 25 per cent to about 2,500 across the country. It will give great visibility to ICICI Bank in western and northern parts of the country.

Post merger, the balancesheet of ICICI Bank would cross Rs 4 lakh crore. BoR has a total business of over Rs 23,000-crore, as against nearly Rs 3,84,000-crore of ICICI Bank.