Fincare SFB to merge with AU Small Finance Bank

Share exchange ratio fixed at 579 shares of AU SFB for 2,000 shares of Fincare SFB [View in browser]( [See all newsletters]( 30 October 2023 Fincare SFB to merge with AU Small Finance Bank [AU Small Finance Bank]( announced the merger of Fincare Small Finance Bank with itself on Sunday night. Confirming [businessline’s newsbreak on September 13]( AU SFB on social media said that “this strategic merger expands the reach and diversifies offerings, reinforcing our commitment to financial inclusion”. Interestingly, the merger is announced about a month after SEBI okayed Fincare SFB’s IPO filing. The scheme of merger is subject to approval of the respective shareholders of the AU SFB and Fincare SFB, the [Reserve Bank of India]( and the Competition Commission of India (CCI). According to AU SFB’s exchange filing, the merged entity should take effect from February 1, 2024, suggesting that the deal should conclude in FY24 subject to regulatory approvals. The share exchange ratio for the amalgamation shall be 579 equity shares of face value of ₹10 each of AU SFB for every 2,000 equity shares of face value of ₹10 each of Fincare SFB. Accordingly, at these exchange ratios, Fincare SFB is valued at around 3x price to book based on Q2 FY24 financials and AU SFB at approximately 4x price to book. - Also Read: [AU Small Finance Bank reports 17% y-o-y increase in Q2FY24 net profit at ₹402 cr]( With a predominantly microfinance oriented book, merger with Fincare SFB will give AU SFB the access to MFI loans and better penetration into the southern markets. AU Small Finance Bank Limited has total assets of ₹95,977 crore, net worth of ₹11,763 crore as on September 30, 2023, and Turnover of 9,240 crore, profit after tax of ₹1,428 crore for the year ended on March 31, 2023 and ₹789 crore for the half year ended September 30, 2023. Fincare Small Finance Bank Limited has total assets of ₹14,777 crore, net worth of ₹1,539 crore, turnover of ₹1,360 crore and profit after tax of ₹219 crore as on September 30, 2023, and Total Assets of ₹12,467 crore, net Worth of ₹1,314 crore, turnover of ₹1,970 crore, profit after tax of ₹104 crore for the year ended on March 31, 2023 You Might Also Like [No passive directors: RBI to bank boards]( [Money & Banking]( [No passive directors: RBI to bank boards]( [MCA’s big reform mandates dematerialisation for private companies]( [Economy]( [MCA’s big reform mandates dematerialisation for private companies]( [Movers & Shakers: Stocks that will see action this week]( [Technical Analysis]( [Movers & Shakers: Stocks that will see action this week]( [Cayman’s exit from FATF grey list may bolster global PE investment into India NBFCs]( [Markets]( [Cayman’s exit from FATF grey list may bolster global PE investment into India NBFCs]( Stay informed Subscribe to businessline to stay up-to-date with in-depth business news from India [arrow]( Copyright @ 2023, THG PUBLISHING PVT LTD. If you are facing any trouble in viewing this newsletter, please try [here]( Manage your newsletter subscription preferences [here]( If you do not wish to receive such emails go [here](