eligibility criteria controlthe documentation proposed ownership existing transaction structuredetails managementregulatory applicationsbusiness plan proper declarationsdetails -funds documentsfit identification documentsfinancial statementssource- proposed shareholderskyc share purchase agreementshareholding patternboard resolutionsshareholder resolutionsdetails involve documents documents generally requiredthe exact documentation depends management practices policies related-party transactions risk management framework internal controls prepared specific requirements applicable essentiala takeover business examine rbi compliance regulatory due diligence financial health liabilities assess assets financial due diligence legal risks regulatory matters corporate governancethe board structure contracts legal due diligence conduct prospective buyer acquiring potential risks regulatory history existing liabilities assets identify litigation licensing status identified guarantees verified regulatory status applicable cor registration valid certificate rbi registrationthe target important areas include undergo comprehensive due diligence buyer limited target nbfceligibility target nbfc conducted financial misconductprevious regulatory approvalscorporate governance historythis review bankruptcy proceedingsdefaults previous regulatory actionspending investigationsmaterial litigationtax complianceinsolvency financial positionthe buyer examine balance sheet profitability contractual obligations customer complaints regulatory proceedings liabilitiespending litigation litigation applicable regulations reporting requirements kyc/aml obligations undisclosed liabilities taxation laws rbi directions compliance historythe target' contingent liabilities provisions asset quality loan portfolio borrowings capital position companies act requirements review regulatory observations tax due diligence regulated financial entity remain ownership intended conclusionthe eligibility criteria ensure continuing compliance step 9 management structure approved ownership implement step 8 corporate approvals obtain applicable regulatory step 7 regulatory documents required transaction step 6 financial capability suitable financially capable persons entities key considerations include rbi approval requirements professional advice transaction circumstances category vary nbfc takeover requirements regulatory advice constitute legal general informational purposes -proper status article latest applicable rbi directions exact eligibility requirements type vary depending rbi requirements compliance condition management eligibility shareholding thresholds disclaimer pending approvals fit- assess targetunclear ownership structureundisclosed beneficial ownershipsignificant pending litigationinadequate corporate governancefailure -compliancepoor financial condition -proper requirementsregulatory satisfy applicable fit- acquisition fundsfailure concerns transaction-related difficulties face regulatory takeover approval issuesan nbfc takeover common reasons business operations lending systems technology evaluate employees operational due diligence potential tax exposures identify outstanding tax liabilities obtain required rbi approvalproposed management meet applicable requirementsthese risks ideally transaction documents step 5 tax conduct legal step 4 check step 3 control structure proposed shareholding acquirer' step 2 understand identify step 1 steps follow nbfc takeovera practical approach prepare binding regulatory category undertaking proceeding persons eligible person investment entity financial institution individual applicable rbi requirements satisfying meet regulatory requirementsthe proposed acquirer acquirer nbfc takeover1 key eligibility criteria transaction signing assessed eligibility shareholding 26% generally required entity nature structure proposed ownership structure source tax laws compliance financial track record reputation integrity factors ownership framework places importance prior approval requirements relevant persons satisfy applicable proposed acquirer important considerations proper statusone fit acquisition triggers rbi approval requirements determine reviewed carefully proper funds regulatory handbook states regulatory framework specifically addresses acquisition financial management control satisfy applicable ownership prospective acquirer rbi reserve bank regulatory framework nbfcs operate company simply acquiring shares requires regulated transaction india nbfc -banking financial company nbfc takeovertaking regulatory requirements completing takeover designed required prior written approval rbi' transaction structure depending existing nbfc significant shareholding acquisition transfer nbfc takeover generally involves applicable regulatory requirements accordance operating capable trustworthy financially sound owners ensure nbfc takeover relevant financial strength assessing suitability nbfcs prior rbi approval requirements subject historically excluding independent directors directors 30% board structure board eligibilitythe proposed management part reviewed result mechanisms board rights shareholder agreements voting arrangements results enforcement action approval obtained management change legal track recordthe regulatory history regulatory sustainability create concerns financially weak acquisition structure evaluating prospective significant owners factors relevant assessment framework considers financial strength separate regulatory consideration broader support complete adequate financial resources important consideration acquirerthe financial capacity planned carefully restructuring takeover involving replacement future operations relevant circumstances rbi framework treats takeover change funding structure legitimate sources shares nbfc' purchasing demonstrate legally permissible identifiable fundsthe source legitimate source clear approval process face difficulties inadequate source questionable financial conduct significant regulatory concerns applicant comply applicable indian laws regulations proper documentation large shareholding transfer involve proposed transaction controleven executing indirect shareholding carefully proposed direct calculate independently trigger rbi approval requirements parties apply equity capital paid- rbi guidance critical aspect shareholding thresholdsshareholding due diligence reduce regulatory concerns progressive increases nbfc acquisition