In Demerger, part of the existing company gets separated from the parent company. It is done in order to focus on core profit-making business, to raise capital, or in order to discourage a hostile takeover.
There are different ways through which demerger can happen- It can be through a spin-off, split up or equity carve out.
Jio Financial Demerger
Reliance Industries Ltd announced the demerger of its financial services Reliance strategic investments from its parent company. The record is 20th July, 2023 and the newly formed company is named Jio financial services. The demerged company will be listed in NSE and BSE. The demerger of the financial services unit involves a spin-off of Reliance Industries 6.1 percent treasury shares.
On 21st August, 2023 Jio Financial shares were listed in NSE with Rs.265 per share and in BSE with Rs 262 per share.