Power Finance Corporation Acquires REC Limited
Analysis based on 9 articles · First reported Feb 06, 2026 · Last updated Feb 07, 2026
The acquisition of Power Finance Corporation===REC Limited by Power Finance Corporation and the proposed merger are expected to create a more robust financial institution, enhancing lending capacity and efficiency in India's power and infrastructure sectors. This consolidation is seen as a positive step for the overall market, potentially attracting more investment into critical infrastructure projects.
Power Finance Corporation has acquired a 52.63% stake in Power Finance Corporation===REC Limited, making Power Finance Corporation===REC Limited its subsidiary. This move follows an 'in-principle' approval from the India===Cabinet Committee on Economic Affairs and aligns with the Union Budget 2026-27 announcement by Finance Minister Nirmala Sitharaman, which outlined a vision for restructuring public sector Non-Banking Financial Companies (NBFCs) to improve credit disbursement and technology adoption. Both Power Finance Corporation and Power Finance Corporation===REC Limited's boards have given in-principle approval for a future merger, with the condition that the merged entity will remain a 'Government Company' under the Companies Act, 2013. This consolidation aims to create a larger, more efficient lending institution to support investments in power infrastructure, renewable energy, and other non-power infrastructure sectors in India, despite potential regulatory challenges related to the India===Reserve Bank of India's exposure limits.
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