Lakshmi Vilas Bank climbs for 4th day on merger talks, up 5%

NEW DELHI: Rising for the fourth straight day, shares of Lakshmi Vilas Bank climbed 5 per cent in Wednesday's trade as the bank signed a non-binding letter of intent (LoI) with Clix Capital Services and Clix Finance for a proposed amalgamation of the Clix Group with the bank.

The stock rose 5 per cent to hit its upper circuit limit at Rs 16.86 on BSE.

In a regulatory filing, Lakshmi Vilas Bank said that under the non-binding LoI, the proposed amalgamation is subject to completion of mutual due-diligence in an exclusive window of 45 days, and will be subject to regulatory and other customary approvals.

"In the event, the discussions between the contracting parties in relation to the proposed transaction are successful and definitive agreements are executed, we will make appropriate disclosures as required under the provisions of applicable law," it said on Monday.

In an earlier filing, the bank said that Clix Capital Services had approached Lakshmi Vilas Bank for a potential investment in the bank.

The bank in the past couple of years has faced liquidity and asset quality issues and has been looking for prospective investors and buyers. It had come up with a merger plan with Indiabulls Housing Finance last year but it was not approved by the Reserve Bank of India.