ICICI Securities share price fell over 3% in the early trade on Friday after the company approved the draft scheme of arrangement for delisting of equity shares and announced the share swap ratio. The stock fell as much as 3.4% to ₹593.40 apiece on the BSE.
The company had on Thursday announced that it will become a wholly owned subsidiary of its parent company ICICI Bank upon delisting. The public shareholders of ICICI Securities would get 67 equity shares of face value ₹2 each of ICICI Bank for every 100 equity shares of the company.
The board of ICICI Bank has also approved the delisting of ICICI Securities.
The draft scheme of arrangement for delisting of equity shares of ICICI Securities was approved at a meeting of the board of directors of the company on June 29, pursuant to which ICICI Bank will issue equity shares to public shareholders of the domestic brokerage in lieu of cancellation of their equity shares in the company.
“While there are business synergies between the bank and the company, a consolidation by way of merger is not permissible on account of regulatory restrictions on the bank from undertaking securities broking business departmentally,” ICICI Securities said in the filing.
Read here: ICICI Securities to be 100% subsidiary of ICICI Bank upon delisting, share swap deal announced
The acquisition is likely to be completed in the next 12-15 months after various regulatory approvals.
As on March 31, 2023, ICICI Bank held 74.85% of the equity shares of ICICI Securities and the balance 25.15% equity shares were held by the public.
ICICI Securities said that as a 100% subsidiary, it is expected that both entities would be able to better capitalize on the synergies in line with the customer 360-degree focus of the bank.
The shares of ICICI Securities have been rallying since the announcement of delisting. It hit a 52-week high of ₹650.00 apiece on Monday, June 26, after the announcement of delisting proposal. It has gained over 8% in one week, while the stock has rallied more than 40% in one year.
At 9:50 am, the shares of ICICI Securities were trading 1.10% lower at ₹607.55 apiece on the BSE.
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Updated: 30 Jun 2023, 09:52 AM IST