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The largest private bank, ICICI is set to become even bigger.  Though the price they are paying to buy out Bank of Rajasthan seems a bit too much.

Bank of Rajasthan, one of the oldest private sector banks in the country, on Tuesday announced that it would merge with the largest private sector bank, ICICI Bank.

The board of ICICI Bank, which met later in the day, also agreed to give in-principle approval for merger of Bank of Rajasthan with it “subject to due diligence and valuation by an independent valuer jointly appointed by both banks.”

“The board will consider the due diligence report and the valuation report at a subsequent meeting. The proposal if approved by the boards of ICICI Bank and Bank of Rajasthan would then be placed before the shareholders of both banks for approval and would be submitted to the Reserve Bank of India (RBI) for its consideration,” ICICI Bank stated after its board meeting here.

Full article here

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If HDFC bank and Centurion bank of Punjab merge then, it will be one of the biggest mergers India Inc has ever seen. The merged entity will be the third largest bank in India with a total asset size of over Rs 2 lakh crore, but still way behind its private sector rival ICICI Bank.

Also HDFC Bank’s 700 branches will see an addition of 390 branches of Centurion, which has a stronghold in the North and South of the country.

The market capitalisation of the combined entity is likely to be at Rs 65,000 to 70,000 crore. Though there may be cultural issues that both banks have to tackle post the merger, it will not be tough for both HDFC Bank and Centurion to integrated as the duo seems quite experienced on the M&A front.

Full article here.

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