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Kotak bank explores bid to take over IndusInd
Kotak Mahindra Bank has a market cap of ₹2.75 lakh crore, while IndusInd Bank is valued at around ₹50,000 crore.
Kotak Mahindra Bank Ltd is exploring a potential takeover of smaller rival IndusInd Bank Ltd, said two people aware of the development. If such a deal is clinched, it could significantly expand Kotak Mahindra’s presence in the Indian banking sector, particularly in the retail segment.
The promoters of Kotak Mahindra and their counterparts in IndusInd Bank have engaged in discussions for the merger via a share swap, said one of the two people cited above, requesting anonymity as the talks are private.
To be sure, the two sides are still in exploratory talks, and no decision has been taken.
Kotak Mahindra Bank has a market cap of ₹2.75 lakh crore, while IndusInd Bank is valued at around ₹50,000 crore.
“We have no comments to offer,” said Rohit Rao, chief communication officer, Kotak Mahindra Group.
“The promoter of IndusInd Bank, IndusInd International Holdings Ltd, completely denies the said rumour and considers it malicious, untrue and baseless. IIHL is promoted by the Hindujas and a broad base of other successful NRIs from the overseas Indian diaspora. They reiterate their full support to the IndusInd Bank, now and always,” the promoters of IndusInd Bank said in response to a query.”The promoter reaffirms its unstinted support to IndusInd Bank.” The proposed merger will help Kotak bolster its retail business as IndusInd Bank has a large, steadily growing retail credit and deposits book.
IndusInd’s retail lending book is diversified and growing faster than that of Kotak Mahindra Bank, the first person cited above said.
The merger discussions come at a time when the promoters of IndusInd Bank, the Hinduja family, are entangled in a family dispute, which is being heard at a London court.
In September, IndusInd Bank raised ₹3,288 crore through a preferential allotment to the promoters and other investors.
