Axis Bank 144a Regulatory News (AXBA)

Date

30th March 2022

Time

19.00 P.M. ( IST)

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1.

Name of the target entity, details in brief such as size, turnover etc.;

1. Citibank N.A. (acting through its branch in India) ("CBNA"): Axis Bank Limited (Axis Bank) proposes to acquire CBNA's entire consumer business in India, including the Credit Cards Business, the Deposits Business, the Wealth Management Business, the Loans Business, the Customer Guarantees Business, the Insurance Distribution Business and the Small Banking Business (collectively the "CBNA Undertaking"), as a going concern, without values being assigned to individual assets and liabilities. The amount of gross revenue of CBNA in India for FY 20-21 was INR 16,15,019 Lacs.[1]

2. Citicorp Finance (India) Limited ("CFIL"): Axis Bank proposes to acquire CFIL's consumer business which includes the commercial vehicle and construction equipment asset backed financing facilities, assigned asset backed financing portfolio, personal loans portfolio, servicing of assigned mortgages loan portfolio (collectively the "CFIL Undertaking"), as a going concern, without values being assigned to individual assets and liabilities. The amount of gross revenue of CFIL, on a standalone basis, for FY 20-21 was INR 77,933 Lacs.[2]

2.

Whether the acquisition would fall within related party transaction(s) and whether the promoter/ promoter group/ group companies have any interest in the entity being acquired? If yes, nature of interest and details thereof and whether the same is done at "arms length"

No, the transactions are not related party transactions.

3.

Industry to which the entity being acquired belongs

The proposed transaction is acquisition of the

CBNA Undertaking from CBNA and CFIL Undertaking from CFIL. Both CBNA and CFIL belong to the Banking and Finance Industry.

4.

Objects and effects of acquisition (including but not limited to, disclosure of reasons for acquisition of target entity, if its business is outside the main line of business of the listed entity)

The acquisition of CBNA Undertaking and CFIL Undertaking will help strengthen Axis Bank's retail banking franchise and accelerate Axis Bank's growth ambitions across various consumer banking segments.

5.

Brief details of any governmental or regulatory approvals required for the acquisition

1. CBNA Undertaking - In terms of government or regulatory approvals, the transaction is subject to approval from the Competition Commission of India. Additionally, approval from other governmental authorities may be required for certain transitional services.

2. CFIL Undertaking - In terms of government or regulatory approvals, the transaction is subject to approval from the Competition Commission of India. Additionally, approval from other governmental authorities may be required for certain transitional services.

In addition to the above, the parties will undertake continuous consultations with the Reserve Bank of India and other relevant governmental authorities as may be required for the implementation of the transactions.

6.

Indicative time period for completion of the acquisition

Subject to the satisfactory completion of the customary and contractual conditions in accordance with the provisions of the CBNA BTA and CFIL BTA, respectively, the transactions are currently anticipated to be completed within 12 months or such other date as may be mutually agreed.

7.

Nature of consideration - whether cash consideration or share swap and details of the same

1. CBNA Undertaking - The entire consideration will be discharged by Axis Bank only in cash.

2. CFIL Undertaking - The entire consideration will be discharged by Axis Bank only in cash.

8.

Cost of acquisition or the price at which the shares are acquired

No shares are being acquired pursuant to the proposed transaction. The cost of acquisition of the CBNA Undertaking and the CFIL Undertaking is INR 12,325 crores.

9.

Percentage of shareholding / control acquired and / or number of shares acquired

Not applicable as no shares are being acquired pursuant to the proposed transaction. The transactions are proposed to be consummated as going concern, without values being assigned to individual assets and liabilities to either business.

10.

Brief background about the entity acquired in terms of products/line of business acquired, date of incorporation, history of last 3 years turnover, country in which the acquired entity has presence and any other significant information (in brief)

1. CBNA Undertaking - CBNA is the consumer division of financial services multinational Citigroup. CBNA was founded in 1812 as the City Bank of New York, and later became First National City Bank of New York. CBNA began operations in India over a century ago in 1902 in Kolkata. The amount of CBNA's gross revenue in India for the last three financial years is as below[3]:

· FY 18-19: INR 15,23,784 Lacs;

· FY 19-20: INR 17,70,195 Lacs; and

· FY 20-21: INR 16,15,019 Lacs.

2. CFIL Undertaking - CFIL is Citigroup's flagship non-banking finance entity. It was incorporated on May 1, 1997 in India. The amount of CFIL's gross revenue, on a standalone basis, for the last three financial years is as below[4]:

· FY 18-19: INR 96,368 Lacs;

· FY 19-20: INR 83,994 Lacs; and

· FY 20-21: INR 77,933 Lacs.