Bank of Rajasthan Ltd (BoR) on Thursday informed the stock exchanges that its board will send the necessary documents to the banking regulator to fa- cilitate the lender's absorption by ICICI Bank Ltd.
This may put to rest speculation about the validity of the extraordinary general meeting (EGM) that was conducted in the absence of top executives of the Udaipur-based lender.
In a notification to the Bom- bay Stock Exchange and the National Stock Exchange, the bank said the board, chaired by one of the independent di- rectors, K.N. Bhandari, decid- ed to send the necessary ap- plication along with support- ing documents for the merger process, to the Reserve Bank of India (RBI) for their approval.
The bank's CEO and manag- ing director G. Padmanabhan, in a telephone interview, did not comment on the EGM but said once the papers were sent, it would be up to RBI to take a holistic view and de- cide on the merger. He did not elaborate on when the board plans to send the documents.
The notice says what it says, said Padmanabhan.
The management and the board's role is over once the papers reach the regulator, he added.
The bank's board told the stock exchanges on Wednes- day that four of its directors had requested a meeting to discuss amalgamation-related issues even as the bank had sought legal opinion about the validity of the EGM.
A civil court in Kolkata had on Monday stayed the EGM that was being con- ducted at a south Mumbai au- ditorium. Following this, the management left the meeting, but shareholders elected their own chairman and went ahead with the ballot. The same day, after a couple of hours, ICI- CI Bank procured an order from the Calcutta high court vacating the lower court's or- der.
Since BoR management was not present in the meeting, it sought legal opinion about the validity of the meeting. This opinion was not disclosed by the management.
Shareholders of both BoR and ICICI Bank voted over- whelmingly in favour of the deal in which the former was valued at more than Rs3,000 crore. BoR shareholders will get one share of ICICI Bank for every 4.72 shares they hold.
The outcome of the board meeting came after market hours. On Thursday, shares of Bank of Rajasthan closed at Rs174.25, down 1.41% and ICI- CI Bank was down 1.9% on the Bombay Stock Exchange. The benchmark Sensex was down 0.14% at 17,730.24 points.