Ujjivan Small Finance Bank Limited entered into a Scheme of Amalgamation to acquire Ujjivan Financial Services Limited for approximately INR 350 billion.

Ujjivan Small Finance Bank Limited (NSEI:UJJIVANSFB) entered into a Scheme of Amalgamation to acquire Ujjivan Financial Services Limited (NSEI:UJJIVAN) for approximately INR 350 billion on October 14, 2022. Upon the Scheme becoming effective, Ujjivan Small Finance would issue and allot to the shareholders of the Transferor Company whose names are recorded in the register of members of the Transferor Company on the Record Date, 116 (One Hundred and Sixteen) equity shares for every 10 (Ten) equity shares in the Transferor Company (?Share Exchange Ratio?). Currently Ujjivan Financial Services holds 73.68% of the equity shareholding of Ujjivan Small Finance.

Upon the Scheme becoming effective, the Transferor Company-Ujjivan Financial Services Limited would stand dissolved. Based on the recommendation of the Audit Committee and the Committee of Independent Directors, the Board of Directors of the Company considered and approved a Scheme of Amalgamation on October 14, 2022. The proposed Scheme is conditional and subject to the approval of the Reserve Bank of India, no-objection of BSE Limited and the National Stock Exchange of India Limited, the Scheme being approved by the requisite majority of each classes of members and/or creditors (where applicable) of the both companies as may be directed by the National Company Law Tribunal, Bengaluru Bench (?NCLT?).

Further, the Scheme is conditional upon Scheme being approved by the public shareholders. Ujjivan Financial Services is in process to get the requisite regulatory approvals, post which we can approach the NCLT. As of February 1, 2023, Reserve bank of India has approved the acquisition.

The entire process may take around 12 months. Scheme will become effective from April 01, 2023, or such other date as may be approved by the NCLT. As of September 11, 2023, NCLT convened Shareholders meeting on November 3, 2023.

As of June 12, 2023, the merger would likely get consummated in Q3 FY24. DAM Capital Advisors Limited, Independent Category-1 Merchant Banker has provided Fairness Opinion in transaction.