As per latest report sources indicate that Shriram Transport Finance Co. Ltd and Shriram City Union Finance Ltd will be merged with Shriram capital Ltd thus there will be one single entity with the shareholding in the separate entities adjusted for parity. Meanwhile the idea is to bring up a fair valuation of the 20% stake in Shriram capital and 10% in Shriram City Union that the ajay Piramal led Piramal Group holds.
Furthermore the stakes were purchased by the Piramals some years back when they wanted to ultimately merge the companies with their own. Perhaps this did not take place for various reasons and now it has been decided that the best way forward is for them to exit the chennai headquartered financial powerhouse and the third entity, Shriram Transport Finance was also in the equation with Piramal holding 9.97% in it and it got sold a few months back for Rs 2,300 crore.
Moreover as for TPG, it has 9.4% in Shriram capital that it wants to sell and move on. hence after considering various options in the past, the merger option will be taken ahead and there will be one listed company and it will be easy to arrive at a proper valuation for the stakes to be sold. Apparently Shriram capital is being valued at around Rs 25,000 crore, though it is not clear if it is pre or post-merger as proposed.
