One of the leading non-banking financial companies (NBFCs) in India, L&T Finance, has announced on Monday the merger of three subsidiaries with itself for “superior governance” and growth.

L&T Finance Ltd., L&T Infra Credit Ltd. and L&T Mutual Fund Trustee Ltd. have been put under one single entity, L&T Finance Holdings Ltd. (LTFH), the company said in a statement.

Boards of these three companies had in January approved the proposed merger and the process was completed on receiving approvals from shareholders, creditors, and regulatory authorities that included RBI, the National Company Law Tribunal, the Securities and Exchange Board of India (SEBI), and stock exchanges.

Speaking on the development, Dinanath Dubhashi, Managing Director & CEO of LTFH, said “It gives me immense pleasure to announce that the merger has been completed before the envisaged time with all the necessary approvals in place. This merger is amongst the key strategic initiatives undertaken by us in line with the ‘Right Structure’ strategy that our Company has been implementing over the last seven years; with the number of NBFCs reducing from 8 to 1.”

“The decision to merge two lending entities with the same NBFC – Investment & Credit Company registrations and one non-operating entity with LTFH was taken after carefully considering market dynamics, internal synergies, and a vision for sustained growth. With the merger, we believe we will be able to unlock newer avenues for growth, innovation, and long-term success. All these benefits would lead to superior governance that would create sustainable value for all stakeholders,” he added.

Post-merger, the LTFH would become an operating lending unit from a holding company, i.e., a core investment company, as mentioned in the press note by the organisation. This would help in generating direct profits from the lending business, gradually increasing enhanced returns to its shareholders.

Last month, L&T Finance released the results of the September quarter for FY 2023-24 and reported a consolidated profit of Rs 595 crore, marking a 46% spike compared to the same period in the previous year.