A rigged merger ratio

Manipulation has always been an essential ingredient of the financial world. However, it has not very often been practiced with such brazenness and little outcry. The merger ratio, so carefully crafted to ensure the govt. holds 51% in the combined entity as required by law, leaves little doubt about the process. One wonders about the moral depravity that permeates the top management of the two institutions and advisors to merger. Is there not a Man (or woman!) in these institutions, who can cry foul and provide details to outside world??

IDBI Bank, which will finish this year with an EPS of at least Rs 8 and expected EPS for next year is Rs 12-13, has been brought at 6 times next years earning in a wider market where stock average a PE of 15. It is unbelievable such deceit is not known to those in power – like the top brass of the Ministry of Finance and The Reserve bank of India. They have chosen to remain mute spectators or collude with their friend M Damodaran to push through the merger.