Sunday, June 15, 2014

Prior RBI Approval needed in case of NBFC Transfer/Acquisition

The prior written permission of the Reserve Bank of India (RBI) shall be required for -


  • Any takeover or acquisition of control of an Non-Banking Financial Company (NBFC), whether by acquisition of shares or otherwise;
  • Any merger/amalgamation of an NBFC with another entity or any merger/amalgamation of an entity with an NBFC that would give the acquirer/another entity control of the NBFC;
  • Any merger/amalgamation of an NBFC with another entity or any merger/amalgamation of an entity with an NBFC which would result in acquisition/transfer of shareholding in excess of 10 percent of the paid up capital of the NBFC.
  • Prior written approval of RBI would also be required before approaching the Court or Tribunal under Section 391-394 of the Companies Act, 1956 or Section 230-233 of Companies Act, 2013 seeking order for mergers or amalgamations with other companies or NBFCs.

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