"With the appointment of a CEO now, the government is trying to buy time for the proposed merger," sources said. The trade unions have already held a series of meetings with finance ministry officials and leaders of the Left parties urging them to expedite the merger exercise.
A CEO has been appointed after over a year. Till now, executive director MV Muthu was looking after the operations after former CEO VP Singh retired in early 2004.
Work at the DFI has been slow due to the fact that there was no CEO for over a year. The delay in the merger between IDBI and IFCI, has added to the problems, sources said.
Meanwhile, it is learnt that IDBI is currently doing the due diligence for taking over IFCI.
| New CEO has been appointed for the ailing IFCI |
Trade unions want government to expedite merger
Merger between IDBI and IFCI would take place only after merger process of IDBI and IDBI Bank is complete
A final decision would be taken only if IDBI is satisfied with due diligence report
A voluntary retirement scheme (VRS) had already been initiated in 2004 to trim the workforce. Trade unions said that if need be, there could be another round of voluntary retirement scheme once the final merger decision is announced.
The previous National Democratic Alliance government had proposed to merge IFCI with Punjab National Bank. However, due to huge protests from the employees, the UPA government decided to merge IFCI with IDBI.
Unions and other employees of the DFI said that merger with IDBI would benefit IFCI due the commonality of assets.