Kotak Mahindra Bank subsidiary merger: KMIL to combine with KAAML
Kotak subsidiary boards approve KMIL merger with KAAML at a 7 for 6 share ratio, subject to approvals, with no change in the bank's shareholding pattern.
The Kotak Mahindra Bank subsidiary merger moved forward on September 25, 2026, with the boards of Kotak Mahindra Investments Limited (KMIL) and Kotak Alternate Asset Managers Limited (KAAML) approving their amalgamation scheme, the bank said in a BSE filing. The proposal would merge KMIL into KAAML on a going concern basis.
Both companies are wholly-owned subsidiaries of the bank, directly and/or indirectly. The scheme falls under Section 233 of the Companies Act, 2013, and remains subject to statutory and regulatory approvals.
Required approvals include sanction from the jurisdictional Regional Director, Central Government, consent from the respective shareholders and creditors, and approvals from BSE, KMIL's designated stock exchange, and the Reserve Bank of India.
Share exchange and financial profile
Under the scheme, KAAML would issue seven equity shares for every six KMIL equity shares held by KMIL shareholders. Shares of both companies have a face value of Rs 10 each.
The filing disclosed the following financial figures as at, or for the year ended, March 31, 2026:
| Financial measure | KMIL | KAAML |
|---|---|---|
| Net worth | Rs 4,156 crore | Rs 1,481 crore |
| Revenue from operations | Rs 1,383 crore | Rs 837 crore |
The companies are related parties. According to the filing, the transaction is at an arm's length price based on an independent registered valuer's report. As a transaction between wholly-owned subsidiaries, it is exempt from Regulations 23(2), (3) and (4) of the SEBI Listing Regulations.
Business alignment behind the proposal
The bank said the merger would complete the business alignment initiated under the RBI's 2025 directions on commercial banks undertaking financial services. KMIL's business activities have been conducted departmentally within the bank from April 1, 2026.
- KMIL stopped sanctioning new loans from April 1, 2026.
- From July 1, 2026, it assigned and transferred its entire bankable loan portfolio to Kotak Mahindra Bank.
- KMIL currently acquires and disposes of securities within its treasury portfolio; KAAML primarily provides alternate asset management and investment advisory services.
The stated objectives include eliminating duplicate corporate infrastructure, aligning group capital and strengthening KAAML's sponsor capital capacity.
Kotak Mahindra Bank is not a party to the scheme. The amalgamation would result in no change in the bank's shareholding pattern.
Source: BSE corporate announcement.