REC merger into Power Finance Corporation approved by President of India

The President of India has cleared a plan to merge REC Ltd into Power Finance Corporation, as per an REC filing. The approval came through a Ministry of Power letter dated June 10, 2026. The move came almost seven years after PFC bought the government’s majority stake in REC.

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REC said the proposal moved ahead after a key decision by its Board of Directors. At a meeting on May 16, the board reserved the merger proposal after the President of India approved it. The filing linked the board step directly to the approval from the Competent Authority.

REC merger with PFC gets President of India approval

REC stated that the Ministry of Power "has conveyed the approval of the Competent Authority President of India in respect of the aforesaid proposal merger of REC into PFC.\" The company placed this update in a regulatory filing. The filing referred to the June 10, 2026 letter from the ministry.

REC also described how the merger would work after legal clearances. Once approved under applicable law and made effective, REC’s assets and liabilities will move to PFC. REC said it would then be dissolved. The process will follow Sections 230-232 of the Companies Act 2013.

REC merger with PFC follows PFC acquisition of government stake

The merger plan follows PFC’s earlier takeover of the government’s holding in REC. In March 2029, state-owned PFC completed the purchase of 52.63 per cent in REC. The deal value was Rs 14,500 crore. REC described the current merger as coming nearly seven years later.

The merger had also been referenced in the Union Budget. Finance Minister Nirmala Sitharaman spoke about combining REC and PFC in the budget speech this year. Sitharaman said the aim was scale and higher efficiency in public sector NBFCs. Sitharaman added it was a first step to restructure Power Finance Corporation and REC.

With inputs from PTI