REC’s proposed merger into Power Finance Corporation has received a conditional no-objection certificate from RBI, REC disclosed on October 15, 2026. This is a regulatory step, not confirmation that the merger or the proposed share exchange has taken effect.
The current filing says other statutory and regulatory approvals, conditions and the required shareholder and creditor consents remain relevant. A no-objection certificate, or NOC, means the regulator does not object subject to its stated instructions and conditions. REC’s one-page disclosure does not reproduce those conditions, so this report does not claim to have verified their full text.
| Item | Verified position | Primary evidence |
|---|---|---|
| Proposed action | REC is the transferor and PFC the transferee under a merger scheme involving their shareholders and creditors | REC’s October 15 NSE filing |
| Latest RBI step | NOC received on October 15, 2026, subject to instructions/conditions specified in it | REC’s October 15 NSE filing |
| Proposed share exchange | 88 fully paid PFC equity shares for every 100 fully paid REC equity shares; face value ₹10 for each company’s shares | REC’s June 28 board outcome |
| Cash consideration | No cash consideration is involved under the proposal; this is not a dividend or bonus issue | REC’s June 28 board outcome |
| Board approval | The boards approved the scheme on June 28, 2026, subject to applicable approvals | REC’s October 15 NSE filing |
| Remaining conditions | Other statutory/regulatory approvals and conditions, including the required shareholder and creditor approvals | REC’s October 15 NSE filing |
| Record/ex/effective/allotment dates | No dated timetable for these events is disclosed in the October 15 filing reviewed; do not infer them from the NOC | REC’s October 15 NSE filing |
What the 88-for-100 ratio actually means
REC’s June 28 board outcome sets out a proposed exchange of 88 PFC shares for 100 REC shares, with ₹10 face value on both sides. For a block of 100 REC shares, the arithmetic is 100 × 88 ÷ 100 = 88 PFC shares, subject to scheme eligibility and effectiveness. Face value is the nominal amount attached to a share; it is not its market price. The calculation does not value the investment or establish a profit.
The scheme proposes shares as consideration rather than cash. It is therefore different from a cash dividend, and it is not a bonus share issue. The arithmetic example does not establish how a fractional entitlement would be handled, and this report does not infer a rule for fractions or smaller holdings.
NOC does not set the record date
The record date determines which eligible holders are counted for an entitlement under the scheme. It should not be substituted with October 15 merely because that is when the NOC was received. The current filing does not provide a dated record, ex-date, effectiveness or allotment timetable. Nor does it establish that the shares have already been exchanged. Subsequent official notices are needed to establish those milestones.
Investors should follow the remaining approval process and the eventual eligibility and implementation notices. This report makes no merger-arbitrage calculation, tax assumption, forecast or assured-return claim. Approval risk and the timing of effectiveness remain distinct from the announced ratio.
For another transaction where regulatory stages must be kept separate, read CapKet’s IDBI Bank sale report. Its buyer selection is not evidence that this REC–PFC scheme is complete.
Primary sources and observation
Checked on October 17, 2026 at 12:45:17 PM IST (07:15:17 UTC). The October filing verifies the latest NOC step; the June board outcome supplies the proposed ratio and cash-consideration terms.
Recorded source observation: . This is a source-check timestamp, not a market quote or a new article update.