In a significant development for the Indian stock market, a major brokerage firm is set to get delisted, a move that has raised eyebrows in financial circles. This company, a subsidiary of ICICI Bank, is preparing to exit the stock exchange despite being a key player that provides individuals and institutions with opportunities to trade in the stock market. The National Company Law Tribunal (NCLT) in Mumbai has cleared all hurdles concerning its delisting, allowing the company to proceed after rejecting objections from minority shareholders.
ICICI Securities to Exit the Stock Market
ICICI Securities, one of India’s leading brokerage houses, has been given the nod to delist from the stock market. This decision has been welcomed by a majority of its shareholders, with approximately 93.8% of them already approving the delisting proposal. The NCLT’s recent oral order supports ICICI Securities in its plan to remove its shares from the market, consequently transitioning into a wholly owned subsidiary of ICICI Bank.
Shareholders to Receive ICICI Bank Shares
As a part of this delisting strategy, shareholders of ICICI Securities will receive ICICI Bank shares as compensation. For every 100 shares held in ICICI Securities, shareholders will be allotted 67 shares of ICICI Bank. This move effectively consolidates ICICI Bank’s stake in its subsidiary, potentially enhancing its operational synergy.
Details of the Share Conversion
| Shares Held | Shares Received |
|---|---|
| 100 ICICI Securities shares | 67 ICICI Bank shares |
Minority Shareholders’ Objections Overruled
The tribunal dismissed objections raised by minority shareholders, Quantum Mutual Fund and Manu Rishi Gupta, who held a minuscule stake of 0.08% and 0.002%, respectively. Their opposition was not enough to sway the decision, as the overwhelming majority of shareholders had already consented to the delisting.
What’s Next for ICICI Securities?
Post-delisting, ICICI Securities will operate solely under the banner of ICICI Bank, reinforcing its status as a fully owned subsidiary. This strategic shift is expected to streamline operations and enhance operational efficiencies as part of the larger financial ecosystem created by ICICI Bank.
Recent Developments and Regulatory Compliance
Besides the delisting news, ICICI Securities has also announced the resolution of a regulatory issue with the Securities and Exchange Board of India (SEBI) concerning compliance with regulatory norms. The company has settled this dispute by making a payment of ₹69.82 lakh, and they have stated that this will help them focus better on their core competencies moving forward.
Conclusion
The decision for ICICI Securities to depart the stock market reflects a significant realignment within the financial services industry in India. With its integration into ICICI Bank, stakeholders can anticipate enhanced offerings and a more robust brokerage service platform, marking a new chapter for both entities.
