Shriram Capital nears finalizing merger deal with 2 lending units – Bloomberg

Shriram Capital Ltd. is close to finalizing a deal to merge with its Shriram Transport Finance Co. Ltd. and Shriram City Union Finance Ltd. units, Bloomberg News reported Nov. 8, citing people familiar with the matter.

The Indian financial services company has been working on the deal for three years now. It will create an entity with an AUM of 1.5 trillion rupees, the unnamed sources noted.

Shriram Capital had put off the merger plan in January after the Reserve Bank of India aired concerns regarding the scheme. One of Bloomberg's sources said that the group's insurance business will be kept out of any potential transaction in light of the central bank's objection.

A final decision is yet to be reached and discussions could still fall apart, the sources added.

A Shriram Group spokesman said all stakeholders of the company will be notified accordingly if it decides to restructure its holdings and operations. Meanwhile, representatives for deal advisers Morgan Stanley and ICICI Securities declined to comment, wrote Bloomberg.

As of Nov. 8, US$1 was equivalent to 73.94 Indian rupees.