The Board of Directors of Power Finance Corporation (PFC) has approved the restructuring involving a merger with REC Limited (REC). This decision follows the announcement by the Hon’ble Minister of Finance on February 1, 2026, regarding the restructuring of Public Sector NBFCs. The merger aims to enhance scale and efficiency, with the combined entity continuing as a Government Company.
Merger with REC Approved
Power Finance Corporation (PFC) has announced that its Board of Directors approved the restructuring involving a merger with REC Limited (REC) at a meeting held on February 6, 2026. The decision aligns with the government’s vision for NBFCs and aims to improve efficiency in the sector.
Background and Rationale
The planned restructuring follows an announcement made on February 1, 2026, by the Hon’ble Minister of Finance. It was stated that the vision for NBFCs includes clear targets for credit disbursement and technology adoption. The restructuring is designed to enhance scale and improve efficiency within Public Sector NBFCs.
Key Details
The merger is in principle, for the amalgamation of PFC and REC, while ensuring that the merged entity continues to remain a “Government Company” under the Companies Act, 2013 and other applicable laws.
PFC had acquired 52.63% of the Government’s holding in REC Limited. PFC and REC are operating as holding and subsidiary companies.
Next Steps
The detailed merger scheme, once finalized, will be shared after requisite approvals are obtained.
Source: BSE
