Aditya Birla Capital said on Wednesday that the Reserve Bank of India has approved the combination of its wholly-owned subsidiary Aditya Birla Finance Limited and itself to create a substantial NBFC. Aditya Birla Capital said in a regulatory filing that “the company and amalgamating company have received letters dated 18 September 2024 from the Reserve Bank of India (RBI) whereby the RBI has accorded its ‘no objection’ for the scheme.”

It is anticipated that the combination would improve value generation, provide shareholders greater access to cash, and create operational synergies. In a statement, Aditya Birla Finance claimed to be the first top-layer NBFC to provide a clear plan for adhering to the RBI’s scale-based restrictions.

In March 2024, the firm board informed the stock markets that the merger had been authorized. On July 2, 2024, the BSE and NSE sent observation letters with “no adverse observations” and “no objection,” respectively.

“Our financial services business has scaled smartly to emerge as a core growth engine for the Aditya Birla Group,” said Kumar Mangalam Birla, chairman of the Aditya Birla Group, in a previous statement. Aditya Birla Capital will be able to extend its operations and contribute to India’s growth narrative with the help of the proposed merger, thereby achieving its goal of enabling the financial dreams of millions of Indians.

The company is now going to contact NCLT to complete the merger procedure. The National Company Law Tribunal, other relevant authorities, and the individual shareholders and creditors of the firms engaged in the scheme, as may be necessary, are among the legislative and regulatory approvals that the scheme is still subject to.

As of December 31, 2023, Aditya Birla Capital managed assets under management of about Rs 4.1 lakh crore, including Rs 1,15,139 crore in total loan AUM and Rs 13,500 crore in gross written premium in the life and health insurance sectors.