New Delhi, July 05, 2023 : The bankers who advised on the merger of HDFC Bank and HDFC Ltd. will receive a fee of just 0.0002% of the deal value, which is around $12 million. This is a relatively small fee for such a large deal, but it is in line with industry norms.The merger, which was announced in April 2022, is the largest ever corporate merger in India. The combined entity will be the largest bank in India by assets, with a market capitalization of over $200 billion.
The bankers who advised on the deal include Morgan Stanley, Citigroup, Goldman Sachs, and JP Morgan. They were responsible for providing financial advice to both HDFC Bank and HDFC Ltd., as well as helping to structure the deal. The fee of $12 million is a relatively small percentage of the deal value. However, it is in line with industry norms for such large deals. For example, the bankers who advised on the merger of Bank of America and Merrill Lynch received a fee of just 0.0003% of the deal value, which was around $150 million.
The relatively small fee for the HDFC Bank merger is likely due to the fact that the deal was relatively straightforward. Both HDFC Bank and HDFC Ltd. are well-established companies with strong financials. As a result, there was less risk involved in the deal, which translated into a lower fee for the bankers.
Despite the relatively small fee, the bankers who advised on the HDFC Bank merger will still be able to generate significant profits. The fee is likely to be shared among the four banks, and each bank is likely to receive a few million dollars in fees. This is a significant amount of money for the banks, and it will help to boost their profits.
The HDFC Bank merger is a major event in the Indian banking industry. The combined entity will be a force to be reckoned with, and it will have a significant impact on the Indian economy. The bankers who advised on the deal played a key role in making the merger happen, and they will be well-compensated for their efforts.