Aditya Birla Group To Club Its NBFCs Following NCLT Approval
The Aditya Birla Group has received approval from the National Company Law Tribunal (NCLT) to combine its non-banking finance companies (NBFCs) in order to create better synergies and ensure optimal use of resources and greater economies of scale, according to sources familiar with the matter.
The Mumbai branch of the NCLT recently sanctioned the merger of six companies in the Birla group, including Umang Commercial Company, Aditya Birla Online Fashion, and Birla Family Investments, into Birla Group Holdings (BGHPL), a key holding company of the Aditya Birla Group.
The amalgamation is also expected to lead to the effective use of capital for the consolidated business's development and growth under a single entity, including the non-banking financial business, which will continue to be the core business, according to the sources.
The other companies involved in the merger are Birla TMT Holdings, Infocyber India and Sunbeam Trading & Investments.
"The merger scheme will... allow the appropriate consolidation of the undertakings of the transferor companies and transferee company," said Birla Group Holdings, through its counsel, to the NCLT. It will result in the formation of a larger company having greater capacity to raise and access funds for its business and conducting trade on more favourable terms," it added.
The group stated in its application that it wanted to simplify its organisational structure and reduce the number of companies within the group.
