It seems funds raised by IDFC First bank from IDFC were negotiated at 58.18/share. It will be bad deal for IDFC shareholders to have stake increased to 39.99% by paying market price for these additional shares and then receive less than 1.65 share of IDFC First per IDFC share. That will be value destructive than returning cash directly to shareholders via dividends.
Not all shareholders of IDFC will be liable to pay tax on the dividend. If IDFC shareholders are going to get less shares than current ownership of IDFC First shares, what’s the motivation for IDFC to increase holding further rather than issuing dividend of additional 2200 cr?
| Subscribe To Our Free Newsletter |
