The acquisition follows in-principle approval from the Cabinet Committee on Economic Affairs (CCEA). After the transaction, PFC and REC operate as holding and subsidiary companies, respectively. REC is a ‘Maharatna’ company under the administrative control of the Ministry of Power, Government of India, and is registered with RBI as a Non-Banking Finance Company (NBFC), Public Financial Institution (PFI) and Infrastructure Financing Company (IFC).

In the filing, PFC also said its board noted the Union Budget 2026–27 announcement on restructuring public sector non-banking financial companies (NBFCs). The Budget, presented on February 1, outlined the government’s approach to sector consolidation. “The vision for NBFCs for Viksit Bharat has been outlined with clear targets for credit disbursement and technology adoption. In order to achieve scale and improve efficiency in the Public Sector NBFCs, as a first step, it is proposed to restructure the Power Finance Corporation and Rural Electrification Corporation,” Union Finance Minister Nirmala Sitharaman had said during her budget speech.

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