Fincare SFB merges into AU Small Finance Bank

HYDERABAD The Board of Directors of AU Small Finance Bank Ltd (AU SFB) and the Board of Directors of Fincare Small Finance Bank Ltd (Fincare SFB), at their respective meetings held recently, approved an all-stock merger of AU SFB and Fincare SFB.The scheme of amalgamation, under Section 44A of the Banking Regulation Act, 1949, is subject to the approval of shareholders of both institutions, along with RBIunder the Banking Regulation Act and the Competition Commission of India.

Upon obtaining the required approvals, Fincare SFB shall merge into AU SFB and shareholders of Fincare SFB shall receive shares of AU SFB in exchange for their shares in Fincare SFB at the approved share swap ratio. All employees of Fincare SFB shall become part of the AU SFB family.The Boards of AU SFB and Fincare SFB respectively considered the results of due diligence of key aspects of each other’s business operations.According to terms, Fincare Business Services Ltd (FBSL), promoter of Fincare SFB, shall infuse Rs700 crore into Fincare SFB prior to the completion of the merger.

Post-merger, Rajeev Yadav the MD&CEO of Fincare SFB, will be appointed as Deputy CEO of AU SFB. He will report to Sanjay Agarwal, MD&CEO of AU SFB. Yadav will continue to lead the Fincare unit of AU SFB, which will house most of the businesses of Fincare SFB. Additionally, he will jointly lead the IT & Digital unit of AU SFB with the MD & CEO of AU SFB, to ensure smooth IT integration post-merger. In his new role, Yadav will be an invitee to Board meetings of AU SFB. Sanjay Agarwal, MD & CEO, AU SFB, said, “This is not just a merger of two entities, its a union of shared values, common goals, and a vision for the future. Rajeev and team are one of the most experienced and seasoned MFI teams in the country who have over the years, built the business ground up despite multiple challenges”.