LVB signs LoI with Clix Capital for proposed amalgamation

Lakshmi Vilas Bank has 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.

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 is successful and definitive agreements are executed, we will make appropriate disclosures as required under the provisions of applicable law,” it said on Monday.

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

Shares of Lakshmi Vilas Bank hit the 5 per cent upper circuit on Tuesday following the announcement. Currently, its shares on the BSE are at Rs 16.06, higher by 4.97 per cent from its previous close.

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.