REC Limited Board Approves Merger with Power Finance Corporation Limited
REC Limited's Board approved its merger with Power Finance Corporation (PFC). REC shareholders will receive 88 PFC shares for every 100 REC shares. The merger aims to strengthen the entity for power sector reforms. The Board also approved raising up to ₹40,000 crore via NCDs, subject to shareholder approval.
A merger of this scale between two major government-owned financial institutions will significantly alter the landscape of power sector financing in India, impacting market structure, operational efficiencies, and funding capabilities.
The approval of the merger with PFC and the plan to raise significant funds are positive developments for REC Limited, indicating strategic growth and consolidation within the power sector financing domain.
The Board of Directors of REC Limited, in its meeting held on June 28, 2026, has approved the scheme of merger by absorption of REC Limited into Power Finance Corporation Limited (PFC). This merger, subject to regulatory and other necessary approvals, will see REC dissolved without being wound up, with its shareholders receiving 88 equity shares of PFC (₹10 face value) for every 100 equity shares of REC (₹10 face value).
The scheme aims to create a stronger, larger entity that will serve as the government's principal institution for implementing power sector reforms and flagship programs. The merged entity is expected to benefit from improved balance sheet strength, a stronger capital base, and higher operational efficiencies, enabling large-scale funding and improved credit flow across the power sector value chain.
REC Limited reported a net worth of ₹84,290 crore and a turnover of ₹59,140 crore for FY 2025-26 on a standalone basis. Consolidated figures for the same period were ₹85,054 crore and ₹59,584 crore, respectively. PFC, the transferee company, reported a standalone net worth of ₹1,02,532 crore and a turnover of ₹58,504 crore for FY 2025-26. Consolidated figures for PFC were ₹1,73,441 crore and ₹1,15,444 crore.
Additionally, the Board approved a proposal for raising funds through the private placement of unsecured/secured non-convertible bonds/debentures of up to ₹40,000 crore. This fundraising is subject to shareholder approval at the ensuing Annual General Meeting and will be raised in one or more tranches within one year from the date of the shareholders' resolution.
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REC Limited filed this with the NSE as a statutory disclosure, categorised under merger. It is a primary document, not a recommendation, and the desk marks it high impact, which is the band that most often changes something.
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See the model portfoliosA plain-language summary of a public exchange filing by REC Limited. Read the original for the full detail.