Fintech firm Slice set to enter banking via merger with SFB
₹11,700 crore and NESFB at over ₹450 crore. “A large part of the value of Slice is coming from its NBFC," the person claimed. With Slice having over 50 shareholders and the small finance bank having 4-5 shareholders in total, a back-of-the-envelope calculation suggests that Slice shareholders will own about 95-97% stake in the merged entity; whereas the remaining 3-5% will be owned by North East SFB shareholders.
The total shareholders in the combined banking entity is going to be 55-60. This merger, pending requisite shareholders’ consent and other regulatory approvals, brings together Slice’s digital prowess and NESFB’s grassroots banking foundation, according to a Slice statement. On the make-up of the board and management after merger, choice of CEO, and if there will be a new name for the combined entity, the person said these matters are expected to be decided later as there are some regulatory processes pending, including clearance from the National Company Law Tribunal (NCLT).
Mint has gathered that the RBI wanted this merger to be announced because as a banking entity, there are many stakeholders involved, including depositors, and lenders. NESFB has been facing severe challenges due to asset quality deterioration owing to the floods in Assam last year and delayed fundraising plans. Slice, which counts Tiger Global, Insight Partners, EMVC, Blume Ventures among its backers, was valued at about $1.5 billion in a funding round last year.
It employs nearly 1,300 people. It is not clear whether there will be any impact on the workforce. Slice did not respond to Mint queries."Exciting news! Mint is now on WhatsApp Channels
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