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Employees won't lose jobs after merger with ICICI: BoR

Press Trust of India/Mumbai 23 May 10 | 08:20 PM
Related to : ICICI Bank Ltd
 ICICI Bank Ltd
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Bank of Rajasthan (BoR) today said its employees will not be adversely affected by the merger with ICICI Bank and there will be no job losses.

"All BoR employees will be retained and there will be no job losses," Bank of Rajasthan Director K N Bhandari told reporters here after a board meeting where shareholders approved the amalgamation with ICICI.

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ICICI Bank Managing Director and Chief Executive Officer Chanda Kochhar too said, "We will be fair (to the employees of BoR). We have always been fair. We have the experience of two earlier mergers and have not retrenched anyone."

ICICI Bank had earlier acquired Bank of Madura and Sangli Bank.

ICICI will have a rational approach and the interest of everybody concerned will be protected, she said, though she shied away from answering a direct question on whether some BoR employees could lose their jobs.

Employees of the troubled-BoR had come out against the proposed move to merge the entity with ICICI Bank, saying it would destroy the identity of one of the oldest private sector banks in the country, and had organised demonstrations in front of the bank's head office and regional offices.

They had also threatened to go on indefinite strike if the merger deal was not shelved.

Nevertheless, the boards of ICICI Bank and Bank of Rajasthan today approved the merger of the two entities by way of a share swap deal that values BoR at about Rs 3,000 crore.

"The board (of BoR) has approved the share swap ratio of 1:4.72. The proposal would now be taken up in an Extra Ordinary General Meeting on June 21," Bank of Rajasthan's RBI-appointed Managing Director and CEO, G Padmanabhan, told reporters after the board meeting here today.

The proposal entitles BoR shareholders to one ICICI Bank share for every 4.72 shares they held. Kochhar said the deal "is a win-win situation for the shareholders", but the Tayal family would not get a seat on the board of the resultant entity.

Talking to PTI, BoR-promoter P K Tayal, who hitherto had close to a 55 per cent stake in the bank, said he was expecting a better valuation for the deal but respects the decision of the boards of both banks.

"I was expecting a better valuation because the bank is a gold mine. But as both boards have approved the valuation, I only respect the decision," Tayal said.

Yesterday, Tayal had sought one ICICI share for every three held by BoR shareholders, saying the deal is a "lottery for ICICI Bank", given its strength in business and the promoters deserved a better valuation.

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