Argus Partners acted as the legal advisors to Gruh Finance Limited in the proposed merger with Bandhan Bank Limited.

This transaction involving the merger of GRUH Finance and Bandhan Bank is probably the largest in this space with the combined market cap of USD 12 billion on the date of the announcement. The deal is the merger of a listed bank and a listed housing finance company. Both the entities are in highly regulated sectors, one being regulated by the Reserve Bank of India and the other by the National Housing Bank.

Since the same is a merger through the court (NCLT) process and the registered addresses of both the entities are in two separate states, separate petitions were filed before NCLT in Kolkata and Ahmedabad and approval from both were obtained. This in turn entailed a longer closing time requiring appropriate protection to both parties without violating the anti trust laws or the takeover and insider regulations. Since the capital structure of a bank is very closely monitored and regulated, the contours of the transaction also needed to be flexible to adopt any change depending on the conditions imposed by RBI. Further, since the provisioning norms applicable to each of the companies is different (being regulated by different regulators), it required a very careful drafting to prevent any interpretation issues.