According to sources, ICICI has already conveyed its decision informally to Anagram Finance's employees. ICICI has informed the shortlisted 150 employees about their new responsibilities and asked the remaining employees to look elsewhere for a job. Anagram has around 500 employees working at its branches across the country.

Though the Anagram offices in key cities have already started reporting to ICICI's headquarters, the formal transfer of control will take place only after the scheme of merger is approved by the Ahmedabad and Mumbai high courts and the necessary formalities are completed with the Registrar of Companies.

While the Ahmedabad high court has given its assent to the scheme of merger, the Mumbai high court isexpected to take up the matter by the end of this month, sources said.

Apart from retrenching a majority of the employees, ICICI will also be closing down some of the Anagram branches, especially in cities where both the entities have a retail presence. Anagram has a strong retail presence of over 25 branches in Maharashtra, Gujarat and Madhya Pradesh. It has a strong presence in the car and truck finance segment, where the existing accounts in the region need to be serviced.

This will be second major retrenchment in the financial sector following the merger of these two companies. The first one took place last year when ICICI took over ITC Classic Finance. Outside these mergers, many non-banking finance companies have been retrenching a large number of their employees over the last two years.

ICICI and Anagram announced their decision to merge in May this year. Anagram is the second major NBFC acquisition by ICICI in as many years as part of its strategy to increase its retail presence. It acquiredAnagram at a merger ratio of one ICICI share for every 16 shares of Anagram Finance.

Anagram Finance, promoted by the Lalbhai group, had run up large bad loans leading to an erosion of its net worth. Apart from the merger ratio, the Lalbhais had to shell out Rs 125 crore to ICICI through the issue of zero-interest preference shares to facilitate the merger and provide a stand-by facility of Rs 100 crore if more loans turn bad.