ICICI Securities on Thursday said it will delist and become a wholly owned subsidiary of ICICI Bank. As of March 2023, ICICI Bank held a 74.85% stake in ICICI Securities. The acquisition is likely to be completed in the next 12-15 months after receiving various regulatory approvals.
Public shareholders will be allotted 67 equity shares of ICICI Bank for every 100 shares of I-Sec. The share exchange ratio has been determined based on the valuation report by independent valuers, and is in compliance with Sebi’s delisting regulations.
ICICI Bank in an exchange filing said the securities broking business is inherently cyclical as it depends on the macroeconomic environment and buoyancy in the equity markets. The bank said I-Sec is a low capital-consuming business and internal accruals are more than adequate to fund the growth.
The bank also said it has strong financial position and does not require additional infusion. Its market capitalization as on June 23, 2023 was Rs 6.5 trillion.
With the delisting, public shareholders of I-Sec will get access to a much larger and more diversified business with greater stability in revenue. “ICICI Securities’ public shareholders would also receive a more liquid stock, which is owned by public shareholders”, said the I-Sec filing.
The stock of ICICI Securities on Wednesday closed up 1.48% at Rs 614.30 on the BSE while that of ICICI Bank closed at Rs 937.45. ICICI Securities had hit a 52-week high of Rs 647 on Monday on the delisting proposal.
