Muthoot Finance approves Muthoot Money merger to create larger gold loan business

Kolkata: Muthoot Finance has decided to merge its wholly owned subsidiary, Muthoot Money, with itself to boost operating synergies and better utilise its workforce and other resources.

Muthoot Finance is the country's largest gold loan company, with Rs 1.80 lakh crore in assets under management. Muthoot Money is also primarily a gold loan lender, with Rs 10,345 crore in AUM.

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The board of Muthoot Finance, an upper-layer non-banking finance company, approved the merger at its meeting on Monday.

The amalgamation would consolidate the operations and business and create a larger gold loan business with enhanced operating synergies, improved utilisation of resources, streamlined workflows and greater operational efficiencies, Muthoot said in a regulatory filing with the stock exchanges.

The amalgamation would also simplify the management structure and optimise costs through the consolidation of office locations and infrastructure and the integration of systems and processes, it added.

The proposal is subject to approvals from the Reserve Bank of India, the National Company Law Tribunal and the company's shareholders.