Shriram Capital, Shriram City Union Finance, Shriram Transport Finance Company announce merger

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Mumbai : Shriram Transport Finance Limited (STFC), India’s largest Commercial Vehicle Financier and Shriram City Union Finance Ltd. (SCUF) and their Promoter entity Shriram Capital Limited (SCL) announced that their boards of directors have approved the merger of SCL & SCUF with STFC.

Pursuant to the merger, Shriram Transport will issue 1.55 shares for every 1 share of SCUF. It’ll also issue 0.09783305 share for every 1 share of SCL o this translates into SCL shareholders getting 1 share of STFC for every 1 share held by SCL in STFC and SCL shareholders will get 1.55 STFC shares for every 1 share of SCUF held by SCL.
The merger would help the group bring together all its lending products – Commercial vehicles, Two-Wheeler Loans, Gold Loan, Personal Loan, Auto Loan & Small Enterprise Finance – under a single roof, thereby creating a financial powerhouse which would end up being a market leader in all the product and consumer segments that it operates in.
SCUF and STFC see this merger as an immense opportunity to strengthen their consumer offerings and provide a more holistic product basket encompassing all lending products, The intent is also to create a comprehensive cross-sell program combining Insurance, broking & AMC businesses, including their Depositors, backed by a state of the art technology platform. SCUF brings with it an enviable granular product suite with an AUM of 35000 Cr and a distribution network of over 950 branches. Post merger with STFC, the merged entity would have a combined AUM of over Rs 1,50,000 Cr, over 2 Crore customers served till date and a distribution network of over 3500. All of these would be serviced by a team of over 50,000 employees.

All customers of SCUF and STFC will, post-merger, be able to access all the products of the merged entities through the vast network of 3500+ branches and sales points of STFC and SCUF. Similar technology architecture in SCUF and STFC will ensure that the branches of the two companies will be interoperable for business of each other in a very short time. Significant leverage on data analytics and understanding of customer needs will enable the merged entity to meet all the financial needs of its 2 crore plus customers. The potential to enhance customer delight and at the same time deliver shareholder value through cross sell of products and services is immense.
“ The merger will enhance our distribution footprint across all business lines without incurring any incremental capex. The benefits likely to accrue due to synergy benefits and the digital initiatives are immense. This merger will also simplify our holding structure eliminating multiple layers” Mr. DV Ravi, MD Shriram Capital said.

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