Beleaguered private sector lender Lakshmi Vilas Bank (LVB) said on Thursday it has received an indicative non-binding offer from Clix Group for the proposed merger.
"Further to the process of considering and evaluating the proposed amalgamation with Clix Capital Services, Clix Finance India and Clix Housing, we are glad to inform that the bank has received an indicative non-binding offer from Clix Group," the bank said in a statement.
"The bank will continue to share information on material developments as and when they materialise." On September 15, LVB said the mutual due diligence process for merger with Clix Group is substantially complete and both parties are in discussions on the next steps.
The bank had signed a non-binding letter of intent with Clix Capital Services and Clix Finance India on June 15.
But on September 25, seven directors were ousted by shareholders, including the Managing Director and CEO. The shareholders at the digitally convened annual general meeting who were unhappy with the governance at Chennai-based bank also ousted the statutory auditors.
With high non-performing assets and inadequate capital adequacy ratio, the Reserve Bank of India had initiated prompt corrective action a year ago for the bank after the Economic Offences Wing of Delhi Police began probing allegations of cheating and criminal breach of trust against its directors of the board.
Established in 1926, Lakshmi Vilas Bank is one of the oldest private sector banks based out of Tamil Nadu. Its net advances last year stood at Rs 20,103 crore and deposits at Rs 29,279 crore.
Clix Capital is into financial services offering various types of loans and is headed by Pramod Bhasin who acquired the business in 2016 from GE Capital. Private equity firm Aion Capital Partners is a significant shareholder in the company.
