Lloyds Fin To Enter M & A Business

The company has already received a category 1 merchant banking license, which is the minimum requirement for entering into mergers and acquisitions.

Executive vice president N Kanchan said that the M&A division will be combining the activities of investment banking, project finance, corporate finance, international banking and business development.

The setting up of an M&A division will trigger off some restructuring within the company, said Kanchan. The finance company will also be looking at hiring professionals from outside for the M&A division.

In the draft code proposed by the Bhagwati Committee, the aggregate minimum offer is to be 20 per cent of the voting capital of the company, provided that the acquisition of shares from each of the shareholders shall not be less than the minimum marketable lot, or the entire holding, if it is less than the marketable lot.

 

The threshold for mandatory public offer has been retained at 10 per cent and merchant bankers have been given greater responsibility. Most of the larger finance companies already have category 1 merchant banking licences and are undertaking mergers and acquisitions. It is expected that the business volumes will look up this year with the takeover code guidelines being formalised.