MUMBAI: Mahindra & Mahindra has sold its entire 3.5% stake in RBL Bank for Rs 678 crore, booking a 62.5% gain on its treasury investment made in Jul 2023 for Rs 417 crore. The sale comes weeks before Emirates NBD launches an open offer on Dec 12 to buy shares from public investors at Rs 280 apiece, closing on Dec 26, as part of its $3 billion plan to acquire a 60% stake in the lender.
The transaction, which includes a preferential issue and open offer, will merge Emirates NBD’s India business with RBL Bank and increase the lender’s net worth to around Rs 42,000 crore. RBL Bank managing director and CEO R Subramaniakumar said the partnership is a “once-in-a-generation opportunity” to transform the mid-sized lender into a large, well-capitalised bank within three to five years.
The capital infusion will be used to strengthen technology systems, expand the bank’s distribution network, and diversify income streams. The preferential issue will follow shareholder and regulatory approvals and be completed within 15 days of the open offer’s closure. Total foreign ownership will remain within the 74% ceiling for private banks.
The merged entity will have a reconstituted board with half of its members being independent directors. It will focus on digital banking , corporate lending , and trade and remittances between India and the Middle East. The merger process, including the integration of Emirates NBD’s three Indian branches with RBL’s 561 branches, is expected to take between 12 and 18 months.
The transaction, which includes a preferential issue and open offer, will merge Emirates NBD’s India business with RBL Bank and increase the lender’s net worth to around Rs 42,000 crore. RBL Bank managing director and CEO R Subramaniakumar said the partnership is a “once-in-a-generation opportunity” to transform the mid-sized lender into a large, well-capitalised bank within three to five years.
The capital infusion will be used to strengthen technology systems, expand the bank’s distribution network, and diversify income streams. The preferential issue will follow shareholder and regulatory approvals and be completed within 15 days of the open offer’s closure. Total foreign ownership will remain within the 74% ceiling for private banks.
The merged entity will have a reconstituted board with half of its members being independent directors. It will focus on digital banking , corporate lending , and trade and remittances between India and the Middle East. The merger process, including the integration of Emirates NBD’s three Indian branches with RBL’s 561 branches, is expected to take between 12 and 18 months.
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